BMW 2015 Annual Report Download - page 100

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Consolidation principles
The equity of subsidiaries is consolidated in accordance
with IFRS 3 (Business Combinations). IFRS 3 requires
that all business combinations are accounted for using
the acquisition method, whereby identifiable assets and
liabilities acquired are measured at their fair value at
acquisition date. An excess of acquisition cost over the
Group’s share of the net fair value of identifiable assets,
liabilities and contingent liabilities is recognised as good-
will in a separate balance sheet line item and allocated
to the relevant cash-generating unit (CGU).
Receivables, payables, provisions, income and expenses
and profits between consolidated companies (intragroup
results) are eliminated on consolidation.
Joint operations and joint ventures are forms of joint
arrangements. Such an arrangement exists when the
BMW Group jointly carries out activities on the basis of
a contractual agreement with a third party that requires
the unanimous consent of both parties with respect to
all significant activities of the joint arrangement.
In the case of a joint operation, the parties that have
joint control of the arrangement have rights to the
assets, and obligations for the liabilities, relating to the
arrangement. Assets, liabilities, revenues and expenses
of a joint operation are recognised proportionately
in the Group Financial Statements on the basis of the
BMW Group’s rights and obligations.
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Business acquisitions
In August 2015, BMW AG (Munich), Daimler AG (Stutt-
gart) and AUDI AG (Ingolstadt) agreed with Nokia
Corporation, Helsinki, to acquire that entity’s maps and
location-based services business (HERE Group), as part
of a joint strategy to secure the long-term availability of
HERE’s products and services as an open, independent
and value-creating platform for cloud-based maps and
other mobility services.
The HERE Group’s digital maps are fundamental for the
next generation of mobility and location-based services,
providing the basis for new assistance systems and, ulti-
mately,
fully autonomous driving. Using high-precision
digital maps in combination with real-time vehicle data,
it will be possible to increase road safety and facilitate the
development of innovative new products and services.
THERE Holding B. V., Amsterdam, and its wholly owned
subsidiary, HERE International B. V., Amsterdam (until
28 January 2016: THERE Acquisition B. V., Amsterdam)
were founded in connection with the acquisition. HERE
International B. V., Amsterdam, acquired all of the shares
of the HERE Group. Via BMW International Holding
pany. Furthermore, the non-consolidated entity, BMW
Forschung und Technik GmbH, Munich, was merged
with BMW AG.
B. V., The Hague, the BMW Group has a 33.3 % share-
holding
in THERE Holding B. V., Amsterdam.
BMW, AUDI and Daimler jointly acquired HERE’s map-
ping service with effect from 4 December 2015. Out of
the total purchase price of € 2.6 billion (subject to
pur-
chase price adjustments), an amount of € 0.6 billion was
financed via bank loans taken up by the intermediary
acquiring entity. The remainder is being financed by the
three partners in equal parts. The BMW Group’s share
of this amount was approximately € 0.67 billion.
THERE Holding B. V., Amsterdam, is included in the
BMW AG Group Financial Statements as an associated
company using the equity method and allocated for
segment reporting purposes to the Automotive segment.
In view of the proximity of the reporting date and on
the grounds of materiality, no fair value adjustments
were recorded in conjunction with the at-equity carry-
ing amount at 31 December 2015, with the consequence
that the Group’s interest is accounted for at cost at that
date. The purchase price allocation is expected to be com-
pleted
in the first quarter of 2016.
THERE Holding B. V., Amsterdam, is included in the
BMW AG Group Financial Statements for the year
ended 31 December 2015 as an associated company using
the equity method (see also note 3).
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90 GROUP FINANCIAL STATEMENTS
90 Income Statements
90 Statement of
Comprehensive Income
92 Balance Sheets
94 Cash Flow Statements
96 Group Statement of Changes in
Equity
98 Notes
98 Accounting Principles and
Policies
113 Notes to the Income Statement
121 Notes to the Statement
of Comprehensive Income
122
Notes to the Balance Sheet
147 Other Disclosures
163 Segment Information