Accounting principles
General
Vedior N.V. was incorporated on 20 May 1997 as a holding company and has its corporate seat in Amsterdam, the Netherlands.
Vedior is one of the world’s largest recruitment companies and is a full-service recruitment provider with a diversified portfolio of brands targeting a broad range of industry sectors.
From its global network of offices spanning Europe, North America, Australasia, Asia, South America and Africa, Vedior offers temporary and permanent recruitment as well as a number of complementary employment-related services such as outplacement, HR outsourcing, payrolling and training.
These financial statements have been prepared in accordance with generally accepted accounting principles in the Netherlands (‘Dutch GAAP’).
In these accounts, the principles used to value assets and liabilities and to determine income are based on historical cost. Unless stated otherwise, assets and liabilities are reported at face value.
Vedior N.V. and its consolidated subsidiaries are referred to in these Notes as the ‘Company’, ‘Vedior’ or the ‘Group’.
Principles of consolidation
Vedior N.V. and its subsidiary companies are fully consolidated. Subsidiary companies are companies where Vedior N.V. directly or indirectly has a majority interest, or where Vedior N.V. otherwise exerts a controlling influence. Minority interests in consolidated equity and consolidated income (loss) are shown separately in the consolidated balance sheet and the consolidated income statement.
Investments in companies in which Vedior N.V. does not have a majority interest or control over the financial and operating decisions, but does exert significant influence, are accounted for by the equity method. Generally significant influence is presumed to exist if at least 20% of the voting stock is owned. Vedior N.V.’s share in the net result of these companies is included in income from associates.
There is one consolidated investment in which Vedior N.V. does not have a majority interest and indirectly holds 33% of the shares. This investment, Acsys, Inc. (US), is fully consolidated as Vedior N.V. has management control. Investments in companies in which Vedior N.V. does not exert significant influence are carried at cost or, if an impairment of value has occurred, at the lower of cost and net realisable value.
Acquisition and disposal of investments
The results of companies acquired or disposed of during the year are included in accordance with Vedior N.V.’s principles of consolidation from the date of acquisition or up to the date of disposal.
With reference to Article 379, paragraph 5, Volume 2 of the Dutch Civil Code, the Company has deposited a list of its capital interests at the office of the Commercial Register in Amsterdam, the Netherlands.
Foreign currencies
The accompanying consolidated financial statements of the Company are reported in millions of euro, unless stated otherwise. The functional currency of non-euro (‘foreign’) operations of the Company is the currency of the primary economic environment in which the Company operates, which is the local currency. The financial statements of foreign operations are translated into euro. Assets and liabilities are translated using the exchange rates on the respective balance sheet dates except for goodwill which is translated using the historical exchange rates. Income and expense items are translated based on the average rates of exchange for the periods involved. The resulting translation adjustments are recorded as exchange differences adjustments within shareholders’ equity.
Gains and losses arising from the translation or settlement of foreign currency denominated monetary assets and liabilities into the local currency are recognised in income in the period in which they arise. However, exchange differences on intercompany loans, which have the nature of a permanent investment, are accounted for as translation differences directly within shareholders’ equity.
The Company’s US Dollars (‘USD’) and British Pounds (‘GBP’) denominated borrowings are accounted for as a hedge of the Company’s net investment in its US and UK subsidiaries with the related functional currencies. Since the Company’s net investments in these respective subsidiaries exceeds the amount of the related borrowings, all translation gains and losses related to these borrowings are included as exchange differences directly in shareholders’ equity.
In 2004, 30% of Vedior’s sales were in currencies other than the euro (2003: 28%), including 8% denominated in USD and 13% denominated in GBP. |