explanatory notes
general
With effect from the financial year 1976 the bases of valuation and
the fixation of profits and losses have been changed with regard to:
- Participations: They are valued at intrinsic value, previously at
acquisition value. In agreement with this revised method of
valuation the consolidated profit and loss account shows the results
obtained by participations, as well as the amounts retained in
these participations.
- Securities: They are valued at purchase price or lower market
value, previously at market value, changes in market value being
reflected in the provision for differences in market value.
These modified bases are also included in the corresponding figures
for 1975.
The change in the basis of valuation for participations results in an
increase in the reserves at 31st December 1976 of f 65,976,000
(in 1975: 57,865,000). The provision for differences in market
value, which amounted to f 1,297,000 at the end of 1975, was
liquidated per that date.
The modified bases with regard to participations do not affect the
profit available, while the net profit before company income tax and
addition to the provision for general contingencies is 9,901,000
(in 1975: f 11,267,000) higher than would have been the case
with the bases previously applied. As a result of the modified bases
with regard to securities 1976 shows a gain of 237,000 on account
of realized profit on market value of securities.
For the rest the bases applied in the annual account have remained
unchanged as compared with the previous year. They are as follows:
Receivables on account of active financing as well as debts on ac
count of passive financing are valued at their nominal amounts. To
cover the general risks on account of lending, a provision as referred
to in Section 329 of Volume 2 Commercial Code was formed,
figuring under 'Payables and transitory items'.
In the calculation of the results the interest gains and charges as well as
the other gains and charges are accounted for in the year to which they
relate.
The incidental gains (one time commission charged, etc.) and costs
(one time commission paid, etc.) attendant upon active and passive
financing are accounted for in the profit and loss account of the
year in which the money is invested or raised.
Cityplan Kronenburg, Amstelveen
photograph Studio Lanza b.v., 's-Gravenhage