Our results

Applied International Financial Reporting Standards platform

Standards and interpretations adopted by the IASB and EU which have entered into effect

Approving the Consolidated Financial Statements the Group applied the following amendments of the standards and interpretations issued by the International Accounting Standards Board for application by the EU:

  • Amendments to IAS 7 Statement of cash flows - Disclosure Initiative - applicable to periods beginning on 1 January 2017 or afterwards. Amendments clarifying IAS 7 to improve information provided to users of financial statements about an entity’s financing activities. The amendments require that the entity use disclosures enabling the users of financial statements to assess the changes in the liabilities following from financing activities, both changes resulting from cash and non-cash flows.
  • Amendments to IAS 12 Income Tax - entitled Recognition of Deferred Tax Assets for Unrealized Losses - applicable to periods beginning on 1 January 2017. The amendments clarify the need to form deferred tax assets on losses on the valuation of financial instruments classified as available for sale. In particular, the change pertains to debt instruments, for which the entity should consider the existence of evidence that it is likely that it will realize the financial instrument for an amount higher than its balance sheet value.
  • Amendments to IFRS 12 as a result of “Amendments to IFRS (cycle 2014-2016)” - added changes as part of the procedure of annual amendments to IFRS (IFRS 1, IFRS 12 and IAS 28) focused mainly on resolving inconsistencies and unification of terminology. Amendments to IFRS 12 apply to annual periods beginning on 1 January 2017 or afterwards.

Application of the above changes to the standards did not have any significant impact on the existing policy applied by the Group.

Standards and interpretations adopted by the IASB and EU which have not entered into effect

Approving these Consolidated Financial Statements the Group did not apply the following standards, amendments of the standards and interpretations which have been issued by the International Accounting Standards Board and approved for application by the EU but have not entered into effect:

  • IFRS 15 – Revenue from Contracts with Customers – applicable to annual periods beginning on 1 January 2018 or afterwards. This standard contains rules which will replace most of the detailed guidelines regarding recognition of revenues currently existing in EU IFRS. In particular, as a result of adoption of the new standard, IAS 18 Revenues and IAS 11 Construction Contracts and the related interpretations will stop applying. The fundamental principle of the new standard provides for recognition of the revenues in the financial statements in such a way as to show the transfer of goods or services to clients in the amount that reflects the amount of the remuneration (i.e. payment) which the Group expects in return for such goods or services. In accordance with the new regulations a revenue occurs at the time when control over the goods or services passes on to the customer. The standard proposes a 5-step approach to revenue recognition:
    1) Identify the contracts with customers, which are understood as parties which concluded a contract with the entity to purchase goods or services, resulting from ordinary activity of the entity, in exchange for compensation;
    2) Identify the performance obligations in the contract;
    3) Determine the transaction price. Determining the transaction price, in addition to the base compensation, one should consider such other components as: variable compensation, non-pecuniary compensation which should be carried at fair value, factors associated with financing the price (by the seller or buyer) e.g. discount resulting from a time difference between the performance of the obligation and the payment for its performance or amounts paid in connection with performance of the obligations of the contract;
    4) Allocate the transaction price to the performance obligations in the contract. The best basis to determine the individual price is the price for which the entity may separately sell the given good or service.
    5) Recognize revenue when (or as) the entity satisfies a performance obligation. The performance obligation is recognized as satisfied upon transfer of the control over the goods or services subject to the agreement to the customer.
  • Clarifications to IFRS 15 Revenue from Contracts with Customers – applicable to annual periods beginning on 1 January 2018 or afterwards. The amendment provides additional explanations regarding certain requirements and introduces additional exemptions for entities which implementing IFRS 15 “Revenue from Contracts with Customers”.
  • IFRS 16 Leases – applicable to annual periods beginning on 1 January 2019 or afterwards. In accordance with IFRS 16 the lessee recognizes the right to use an asset and lease liability. The right to use an asset is treated like other non-financial assets and amortized accordingly. Lease liabilities are initially measured at current value of the lease payments payable during the lease term, discounted by the lease rate, if it is not difficult to determine it. If such rate cannot be easily determined the lessee applies the marginal interest rate.
  • IFRS 9 – Financial Instruments – the key amendments introduced by the new standard pertain to:
    1) Changes of the rules of classification and valuation of financial assets which are based on the entity’s business model for managing the assets and the cash flow characteristics. The existing categories of financial assets have been replaced with new ones, i.e. carried out at:
     - Amortized cost,
     - Fair value through other comprehensive income,
     - Fair value through profit or loss.
    The amended standard imposes an obligation to carry shares in unlisted companies in fair value and significantly reduces the existing possibility of carrying assets at cost.
    2) introduction of a new model for assessment of impairment of financial assets which replaces the concept of incurred losses with the concept of expected credit losses.
    3) Hedge accounting model.

Impact on consolidated financial statements:

Impact on consolidated financial statements:

Below we present the impact of the following published standards on the accounting policy (principles):

  • IFRS 9 – Financial Instruments – change of the rules of classification will cause a change of classification of financial assets in the Group’s financial statements. Instruments currently classified into the loans and receivables category satisfy the conditions of classification into assets carried at amortized cost, hence the entry into force of IFRS 9 will not cause a change in the rules of their valuation. Shares held by the Group in companies not listed on active markets are currently carried at purchase price minus impairment losses, if any. As at 31 December 2017 the Group, as part of interests in unlisted companies, presents mainly the value of the shares in Euroterminal Sławków Sp. z o.o. in the amount of PL 6,021 thousand. The process of valuation of the shares of Euroterminal Sławków Sp. z o.o. by an independent advisor is currently underway. In the case of shares in other companies not listed on active markets, the Group does not have sufficient up-to-date information to determine their fair value. The amendments to the accounting policy assume that the effects of fair value valuation of investments in equity instruments will be recognized in other comprehensive income. Below are presented the changes in the classification and valuation of financial assets and liabilities in connection with entry into force of IFRS 9.

    Data in ths. PLN
     Existing approach IFRS 9
     Financial assets by category and classAs at 31/12/2017 (audited)Valuation method Financial assets by category and classValuation method
     Hedging financial instruments Hedging financial instruments
     Derivative instruments12,047at fair value through other comprehensive income Derivative instrumentsat fair value through other comprehensive income
     Available-for-sale financial assets Financial assets measured at fair value through other comprehensive income
     Shares in unlisted companies7,286at cost minus impairment losses Investments in equity instrumentsat fair value through other comprehensive income
     Loans and receivables Financial assets measured at amortized cost
     Trade receivables688,806at amortized cost Trade receivablesat amortized cost
     Receivables from sale of non-current assets111at amortized cost Receivables from sale of non-current assetsat amortized cost
     Loans granted1,069at amortized cost Loans grantedat amortized cost
     Bank deposits above 3 months253,805at amortized cost Bank deposits above 3 monthsat amortized cost
     Cash and cash equivalents516,776at amortized cost Cash and cash equivalentsat amortized cost
     Total1,479,900    


    The new financial assets impairment assessment model implemented by the Group is based on an analysis of the probability of expected credit losses on trade receivables. The probability of expected credit losses was estimated on the basis of the historical analysis of recoverability of the balances of trade receivables in specific aging ranges. The initially determined amount of the additional impairment loss on trade receivables resulting from the implementation of IFRS 9 amounts to PLN 3.3 million. The Group has taken advantage of the IFRS 9 transition provisions allowing for refraining from conversion of comparative data as regards the changes regarding classification and valuation and impairment of financial assets. As per initial estimates changes resulting from application of IFRS 9 will be reflected as at 1 January 2018 as follows:
    - trade receivables will be reduced in the amount of PLN 3.3 million,
    - deferred tax assets will increase in the amount of PLN 0.6 million,
    - retained earnings will be reduced by the amount of PLN 2.7 million.

    The changes in hedge accounting in the case of the Group pertained mainly to documentation issues and hence entry into force of IFRS 9 in this extent, did not impact the Group’s asset and financial standing.
  • IFRS 15 – Revenue from Contracts with Customers – Analyzing the 5-step approach to recognition of revenues in accordance with IFRS 15, the Group has identified in the analyzed agreements (primarily agreements associated with rail transport and freight forwarding) an inbuilt variable compensation component resulting primarily from:
    - the possibility of imposing fines on the client in connection with failure to meet the contractual provisions pertaining to transport of a specified freight volume during the term of the agreement;
    - the possibility of imposing fines on the Group by the client in the event of failure to transport the ordered freight volume / failure to perform the agreement.
    So far these fines have been presented as other revenues or operating expenses depending on the nature of the fine. According to the new standard, starting from 1 January 2018 the above fines will be treated as an element of revenues from sales of services. As at 31 December 2017, other operating revenue comprised fines resulting from not ordering the contractual freight volume in the amount of PLN 2.1 million. Other operating expenses, in turn, included the fines due to the Group’s customers in the amount of PLN 5.6 million. In accordance with the new standard, the amount of revenues from sales of services as at 31 December 2017 as a result of restatement will be reduced by PLN 3.5 million to PLN 4.637.3 million. Based on IFRS 15 C3 a) the Management Board of the Parent Company has decided that the standard will be implemented retrospectively in accordance with the requirements of IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors, with the possibility of taking into account the instructions contained in clause C5. As a result of carried out analyses, it has not been identified that the application of this approach should result in correction of the Group’s equity as at the date of its first application.
  • IFRS 16 Leases - preliminary analysis of the impact of IFRS 16 on the applied accounting principles has shown that the Group will have to recognize retrospectively in the financial statements significant lease liabilities and the rights to use assets (mainly land, buildings and structures) which are currently subject to long-term operational leasing agreements, or rental or lease agreements. The Group is currently in the process of detailed identification of the agreements subject to the new requirements of the standard and preliminary preparation of possible valuation models and capturing of the aforementioned agreement in the financial statements. At this stage it is not possible to determine the numerical impact of IFRS 16 on the Group’s financial statements.

The Group has carried out an analysis of the potential impact of the remaining standards, interpretations and amendments to the standards, as mentioned above, on the accounting policy (principles) applied by the Group and in the opinion of the Management Board of the Parent Company, they will not have any material impact on the currently applied accounting policy (principles).

Standards and interpretations adopted by the IASB but not yet approved by the EU which have not entered into effect

IFRS as approved by the EU do not currently differ materially from the regulations adopted by the International Accounting Standards Board (IASB), with the exception of the following standards, their amendments and interpretations, which as at 31 December 2017 have not yet been approved by the EU and have not entered into effect:

  • Amendments to IFRS 2 Share-based Payment entitled Classification and valuation of share-based payment transactions apply to annual periods beginning on 1 January 2018. This amendment to IFRS 2 clarifies that the fair value of share-based payments settled in cash should be determined in the same way as in the case of payments settled in equity instruments. The amendment of the standard introduced a requirement of adjustment of the liability through taking into account each change of the value in the financial result before change of the classification from liabilities to equity. The cost recognized after modification is based on the fair value from the modification date. The amendment has introduced an exception according to which the payment of cash to the tax authority is treated as part of the settlement in the form of equity instruments. The entity should disclose the estimate amount that it expects to pay to the tax authority on account of such tax. As at the date of the first application of this amendment, the reclassification of the liability to equity will not have any impact on the financial result.
  • Amendments to IAS 19 Employee Benefits – Amendment, limitation or settlement of the plan (applicable to annual periods beginning on 1 January 2019 or afterwards). The amendments require that after change of the plan, updated assumptions for valuation should be applied to determine the current costs of the services and interest (net) for the remaining part of the reporting period (issued on 7 February 2018).
  • Interpretation of IFRIC 22 - entitled Foreign Currency Transactions and Advance Consideration. applicable to annual periods beginning on 1 January 2018. The interpretation clarifies the term of transactions comprising receipt or payment of an advance consideration in a foreign currency.
  • Amendments to IAS 40 Investment Property – entitled Reclassification of investment property - applicable to annual periods beginning on 1 January 2018. The amendments raise the question of whether an investment property under construction should be transferred from inventory to investment property if there is a clear change in its use.
  • IFRS 17 Insurance Contracts – applicable to annual periods beginning on 1 January 2021 or afterwards. The aim of the standard is to introduce uniform, formalized accounting principles applicable to insurance contracts. The new standard stipulates that insurance liabilities are carried at the current value of the obligation performance and introduces uniform rules for valuation and presentation for all types of insurance contracts. IFRS 17 replaces IFRS 4 Insurance Contracts and the related interpretations.
  • Interpretation of IFRIC 23 entitled Uncertainty over Income Tax Treatments – applicable to annual periods beginning on 1 January 2019. The interpretation applies to determining the income to be taxed (tax loss), taxation basis, unused tax losses, unused tax reliefs, tax rates, if there is uncertainty as the treatment of the income tax pursuant to IAS 12.
  • Amendments to IFRS 9 Financial Instruments entitled Prepayment Features with Negative Compensation – applicable to annual periods beginning on 1 January 2019. The amendments make it possible for entities to carry some financial assets subject to prepayment with the so-called negative compensation at amortized cost.
  • Amendment to IAS 28 – Investments in Associates and Joint Ventures entitled Long-term shares in associates and joint ventures - applicable to annual periods beginning on 1 January 2019. The amendments clarify how the entity should apply IFRS 9 to long-term shares in associates and joint ventures which constitute part of the net investment.
  • Amendments to different standards “Amendments to IFRS (cycle 2015-2017)” - changes made as part of the procedure of annual amendments to IFRS (IFRS 3, IFRS 11, IAS 12 and IAS 23) focused mainly on resolving inconsistencies and unification of terminology (applicable to annual periods beginning on 1 January 2019 or afterwards).

The Group has carried out an analysis of the potential impact of the standards, interpretations and amendments to the standards, as mentioned above, on the accounting policy (principles) applied by the Group and in the opinion of the Management Board of the Parent Company, they will not have any material impact on the currently applied accounting policy (principles).