Fiven Annual Report 2020

Note 2 Significant accounting policies Functional currency The functional currency is determined in each entity in the Group based on the currency within the entity's primary eco- nomic environment. Transactions in foreign currency are trans- lated to functional currency using the exchange rate at the date of the transaction. At the end of each reporting period foreign currency monetary items are translated using the closing rate, non-monetary items that are measured in terms of historical cost are translated using the exchange rate at the date of the transaction and non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was measured. Presentation currency The Group’s presentation currency is Euro. This is also the parent company’s functional currency. The statement of financial position figures of entities with a different functional currency are translated at the exchange rate prevailing at the end of the reporting period for balance sheet items, including goodwill, and the exchange rate at the date of the transaction for profit and loss items. The monthly average exchange rates are used as an approximation of the transaction exchange rate. Exchange differences are recog- nized in other comprehensive income (“OCI”). Consolidation principles The Group’s consolidated financial statements comprise the parent company and its subsidiaries as of 31 December 2020. An entity has been assessed as being controlled by the Group when the Group is exposed for or have the rights to variable returns from its involvement with the entity, and has the ability to use its power over the entity to affect the amount of the Group’s returns. Thus, the Group controls an entity if and only if the Group has all the following: • power over the entity; • exposure, or rights, to variable returns from its involvement with the entity; and • the ability to use its power over the entity to affect the amount of the Group’s returns. There is a presumption that if the Group has the majority of the voting rights in an entity, the entity is considered as a subsidi- ary. To support this presumption and when the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and circumstances in assessing whether it has power over the entity. Including ownership interests, voting rights, ownership structure and relative power, controlled by the Group and shareholder's agreement or other contractual agreements. See note 4 Composition of the group for a more detailed description of the Group's assessments regarding control. The assessments are done for each individual investment. The Group re-assesses whether or not it controls an entity if facts and circumstances indicate that there are changes to one or more of the three elements of control. Business combinations are accounted for by using the acquisition method, see note 4 Acquisitions. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Current versus non-current classification The Group presents assets and liabilities in the consoli- dated statement of financial position as either current or non-current. The Group classifies an asset as current when it: • Expects to realize the asset, or intends to sell or consume it, in its normal operating cycle • Holds the asset primarily for the purpose of trading • Expects to realize the asset within twelve months after the reporting period Or • The asset is cash or a cash equivalent, unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period. All other assets are classified as non-current, including deferred tax assets. The Group classifies a liability as current when it: • Expects to settle the liability in its normal operating cycle • Holds the liability primarily for the purpose of trading • Is due to be settled within twelve months after the reporting period Or • It does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting period. Fiven Annual Report 2020 32   Financial statements