Porsche 2012 Annual Report Download - page 167

Consolidation principles
As the accounting at equity has a significant influence on the net assets and results of oper-
ations of the Porsche SE group, the consolidation principles applicable only within the Porsche
Holding Stuttgart GmbH group and the Volkswagen group are also included in the explanations
below.
In the reporting period, the financial statements of all subsidiaries and investments account-
ed for at equity were prepared as of the reporting date of the consolidated financial statements,
which is the reporting date of Porsche SE. Where necessary, adjustments are made to uniform
group accounting policies.
Business combinations are accounted for by applying the acquisition method pursuant to
IFRS 3 (rev. 2008).
The cost of a business combination is measured in accordance with IFRS 3 (rev. 2008) as
the aggregate of the consideration transferred at fair value as of the acquisition date, measured
at acquisition-date fair value, and the non-controlling interests in the entity. The non-controlling
interests can be measured either at fair value or at the proportionate share of the acquiree’s
identifiable net assets. Acquisition-related costs are expensed and therefore do not constitute a
component of cost. Contingent consideration is measured at the fair value on the acquisition
date. Subsequent changes in value do not generally lead to an adjustment in the measurement
as of the acquisition date.
If the business combination is achieved in stages, the acquisition-date fair value of the ac-
quirer’s previously held equity interest in the acquiree is remeasured to fair value as of the acqui-
sition date and the gain or loss resulting from remeasurement recognized in profit or loss.
Where the cost of a business combination exceeds the fair value of identifiable assets ac-
quired net of liabilities assumed as of the acquisition date, the excess is recognized as goodwill.
In contrast, where the cost of a business combination is less than the fair value of identifiable
assets acquired net of liabilities assumed as of the acquisition date, the difference is recognized
in the income statement after reassessing the fair values.
Any difference arising upon acquisition of additional shares or sale of shares after initial con-
solidation without loss of control in a subsidiary that has already been fully consolidated is rec-
ognized within equity.
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