Explanatory notes
Friesch-Groningsche Hypotheekbank
and affiliated banks
General
Participations are stated at intrinsic values. The consolidated profit
and loss account therefore shows the results of these participations.
Receivables from mortgage financing are valued at face amounts less
write-offs of uncollectable items.
Additionally, to cover the general risks involved in lending, a provision
was established under section 329 of volume two of 'Burgerlijk
Wetboek (the civil code) which is listed under 'Payables and transitory
items'.
Liabilities resulting from debt financing are recorded at face value.
Securities are valued at the lower of purchase or market price.
In calculating the results, interest received and paid, as well as other
gains and expenses, are accounted for in the year to which they apply.
All assets and liabilities denominated in foreign currencies are
translated into Dutch guilders at rates prevailing at the balance sheet
date. Currency exchange gains and losses are throughout the Group
transferred to a central parent company account.
The resulting net balance of currency exchange gains and losses is
recorded there as a change in shareholders' equity.
The result from one transaction in foreign currency, now fully settled,
is accounted for under 'Sundry gains and charges'.
Incidental gains such as loan origination fees and charges such as
commissions paid, etc. incurred in mortgage and debt financing are
accounted for in the profit and loss account of the year when the
money is received or expended.
Corporate tax included in the profit and loss account is calculated on
the balance of this account, after allowing for tax-free profit items.
In calculating corporate tax, the addition to the provision for general
contingencies has been treated as a tax deductible item.
The principles of valuation and determination of profits and losses for
the annual accounts of Friesch-Groningsche Hypotheekbank nv are
the same as those applied in the consolidated annual statement.
The explanatory notes only show figures for the consolidated annual
accounts. For the names and places of registration of participations,
we refer to the list deposited with the Amsterdam Commercial
Register.
30
