Explanatory notes
General
The combined balance sheet and profit and loss account comprise the
annual accounts of the majority participations in real estate companies
and other diversifications.
The combined balance sheet includes the figures of the 100% interest
in Kok Group International bv acquired in 1979 and that of Aannemings-
maatschappij Gebam bv, in which also a 100% interest was acquired in
1979. In 1978 the 50% interest in this subsidiary was incorporated under
Participations. The combined profit and loss account includes the results
of these participations as from the date on which the 100% interest was
acquired.
The general basis of valuation for real estate in operation is: cost of
purchase or construction reduced by an annual depreciation.
Depreciation is based on these costs, taking into account the useful life.
A few objects, the sale of which is intended in the near future, have been
valued at cost of purchase or construction reduced by income realised.
In both cases valuations made do not exceed the market value.
As a result of the sale of real estate in operation, the difference between
proceeds and book value is accounted for. For a few old projects the
sales result thus fixed is transferred to the replacement reserve. The
fiscal claim weighing on this replacement reserve has been accounted
for under 'Provision for latent tax liabilities'.
With effect from 1979 purchase sums received have been deducted from
real estate under development. The figures at the end of 1978 have been
adjusted accordingly.
Real estate under development is valued at the costs, including interest,
incurred for the projects concerned till the moment of sale or lease.
Interest is calculated on the amount invested at the average interest rate
for mortgage loans. The valuation per project will not exceed the market
value of the real estate. The result of a sale is accounted for in the year
in which a project is completed or - if the result of the sale is certain - in
the year in which part of the project is completed.
Works in progress of the building firm are included under Real estate
under development after deduction of instalments received. Valuation
is made at cost including a loading for indirect costs of 5%. Foreseeable
losses are deducted from the valuation in the year in which they have
been incurred. The result is accounted for in the year in which the work
has been completed.
(Minority) participations are valued at cost.
Receivables, including the receivables from participations, have been
valued at nominal value after deduction of provisions deemed necessary.
Nominal assets and liabilities in foreign currency have been valued at
the rates of exchange per the balance sheet date. The other assets have
been valued at the historical rates.
The provision for maintenance is meant to lead to a better spread of the
cost of periodic maintenance. To the charge of the result, this provision
is annually increased by an amount calculated per object on the basis of
the cost and frequency of periodic maintenance and the expenses
incurred in such a year are charged to this provision. The method applied
entails that the amount that should be present in the provision can at any
time be calculated per real estate project and per category of maintenance.
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