16 - Investments in joint ventures / operations and associates

Accounting policies

Joint control refers to the contractually agreed sharing of control over an arrangement that only exists when decisions about the business' relevant activities require unanimous consent from the parties sharing control.

A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the assets, and obligations for the liabilities, relating to the arrangement. A joint venture represents a type of joint arrangement, typically a legal entity (in the case of Unica Group a limited liability company) where the parties having joint control possess rights to the net assets of the arrangement.

For in interest in joint operations, except for those that can be categorized as passing-through (acting as a conduit to pass-through invoices to or receipts from end-customers on behalf of other Group companies), the Group recognizes its assets, including its share of any assets held jointly, Its liabilities, including its share of any liabilities incurred jointly, its revenue from the sale of its share of the output arising from the joint operation, its share of the revenue from the sale of the output by the joint operation and Its expenses, including its share of any expenses incurred jointly.

Unincorporated joint operations ("vof") do not contain any equity balances. Any difference between assets and liabilities is incorporated into receivables or liabilities with partners, which are classified as related parties.

An associate is an entity over which the Group has significant influence. Significant influence is the power to participate in the financial and operating policy decisions of the investee but does not confer full control or joint control over those policies.

The considerations made in determining significant influence or joint control are similar to those necessary to determine control over subsidiaries. The Group’s investment in its associates and joint ventures are accounted for using the equity method. Under the equity method, the investment in an associate or a joint venture is initially recognized at cost. The carrying amount of the investment is adjusted to recognize changes in the Group’s share of net assets of the associate or joint venture since the acquisition date. Goodwill relating to the associate or joint venture is included in the carrying amount of the investment and is not tested for impairment separately.

The statement of profit or loss reflects the Group’s share of the results of operations of the associate or joint venture. Any change in OCI of those investees is presented as part of the Group’s OCI. In addition, when there has been a change recognized directly in the equity of the associate or joint venture, the Group recognizes its share of any changes, when applicable, in the statement of changes in equity. Unrealized gains and losses from transactions between the Group and the associate or joint venture are eliminated to an extent proportional to the Group's interest in the associate or joint venture.

The aggregate of the Group’s share of profit or loss of an associate and a joint venture is shown on the face of the statement of profit or loss outside operating profit and represents profit or loss after tax and non-controlling interests in the subsidiaries of the associate or joint venture.

The financial statements of the associate or joint venture are prepared for the same reporting period as the Group. When necessary, adjustments are made to bring the accounting policies in line with those of the Group. After application of the equity method, the Group determines whether it is necessary to recognize an impairment loss on its investment in its associate or joint venture. At each reporting date, the Group determines whether there is objective evidence that the investment in the associate or joint venture is impaired. If there is such evidence, the Group calculates the amount of impairment as the difference between the recoverable amount of the associate or joint venture and its carrying value, and then recognizes the loss as ‘Share of profit of an associate and a joint venture’ in the statement of profit or loss.

Upon loss of significant influence over an associate or loss of joint control over a joint venture, the Group measures and recognizes any retained investment at its fair value. Any difference between the carrying amount of the associate or joint venture upon loss of significant influence or joint control and the fair value of the retained investment and proceeds from disposal is recognized in profit or loss.

The table below summarizes the investments in joint ventures (In € 1,000):

The table below details the percentage holding in each entity (In € 1,000):

PI2M was liquidated in 2022.

Aggregate summarized financial information (in € 1,000)