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Unformatted text preview: ial statements / telenor group One-time effects on pension costs in 2011 were related to restructuring of operations in Telenor Norway. In 2010 one-time effects were
related to closing of the current AFP (early retirement) pension scheme in the Norwegian companies. See note 27 for more information. / 11 / Research and development costs
Research and development costs that have been recognised in the income statement amounted to NOK 387 million in 2011 (NOK 387
million in 2010). Expensed research and development activities relate to new technologies, new services and products, security in the network
and new usages of the existing network. The amount above exclude development recognised as intangible assets or property, plant and
equipment in the statement of financial position. / 12 / Depreciation, amortisation and impairment losses Property, plant and equipment NOK in millions 2011 depreciation and amortisation impairment losses Total depreciation, amortisation
and impairment losses 2010 Goodwill 2011 intangible assets 2010 2011 2010 Prepaid leases Total 2011 2010 2011 2010 (11 163) (11 270) (36) - - (1437) - (14) (4 010) (2 867) (4 643) - (136) - (221) (15 309) (16 134)
- (4 340) (14) (11 270) (1 437) (14) (6 877) (4 643) (136) (221) (11 199) (19 649) (16 148) Impairment losses primarily relate to uninor. The impairment loss was recognised as a consequence of the Indian Supreme Court ruling
on 2 February 2012 cancelling all existing 2G licenses of uninor with effect from 2 June 2012. See note 17, 18, 19, 35 and 38 for further
Prepaid leases primarily relate to access charges for lease of the cables of other operators (local loop unbundling etc) in Sweden and
Denmark. The basis for the amortisation period for access charges is the estimated customer relationship period, which is based on historical
information. See note 22 for more information. / 13 / Financial income and expenses
NOK in millions 2011 2010 interest income on cash and cash equivalents dividend income on available-for-sale financial assets Other financial income Total financial income 724 9 79 812 478
765 interest expenses on financial liabilities measured at amortised cost Capitalised interest Total interest expenses
Other financial expenses Total financial expenses (2 042) 41 (2 001)
(206) (2 207) (1 706)
(1 825) 73 (350) (277) 18
(649) Net change in fair value of financial instruments at fair value through profit or loss 27 (370) Net gains (losses) on disposal of financial assets available-for-sale Net gains (losses) on disposal of financial assets at fair value through profit or loss Other net gains (losses) financial assets Net gains (losses and impairment) of financial assets and liabilities 54 - (3) 52 55
90 Net foreign currency gains (losses), excluding effects of reclassifications Amounts reclassified from equity to profit and loss Net foreign currency gains (losses) Net financial income (expenses) (1 593) (1 989) The increase in financial income in 2011 compared with 2010 is mainly due to increased interest rates on cash and cash equivalents. The
higher level of other financial income in 2010 was primarily related to benefits from Cross Border QTE Leases for GSM mobile network and
fixed line network. /page 40/
telenor annual report 2011
notes to the financial statements / telenor group The increase in financial expenses in 2011 compared with 2010 is mainly due to changed composition of debt in the group, with a higher
portion of debt in high-yield currencies like the Indian Rupee in 2011.
Borrowing costs are capitalised (capitalised interest) on qualifying assets and is based on terms for the general borrowing programs for
Norwegian subsidiaries or the relevant foreign subsidiaries’ borrowing costs. Subsidiaries owned 90% or more by the Group are financed by
the Group. See note 29 for further information about interest rates on external borrowings.
The net change in fair value of financial instruments is primarily attributable to derivatives used for economic hedge of interest-bearing
liabilities that do not fulfil the requirements for hedge accounting.
Amounts reclassified from equity to profit and loss in 2011 consist of a currency loss of NOK 350 million from the initial investment in uninor
that was previously recorded in equity and has been reclassified to profit and loss in 2011. Amounts reclassified from equity to profit and
loss in 2010 include NOK 534 million reclassified at the implementation of revised IAS 27, after which it was no longer possible to hedge the
acquisition of non-controlling interests. / 14 / Income taxes
NOK in millions 2011 2010 Profit before taxes 12 575 20 205 Current taxes deferred taxes Income tax expense (5 353) (5) (5 358) (6 503)
(4 982) Deferred tax income decreased in 2011 compared to 2010. The deferred tax income in 2010 was mainly due to reversal of withholding tax
provisions related to OJSC VimpelCom and Kyivstar of approximately NOK 1 billion...
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This document was uploaded on 03/21/2014.
- Spring '14