DES GB2012 E

Basis of consolidation and consolidation methods The company also acquired ownership of the Herold-Center Norderstedt with the property purchase agreement dated 16 November 2012. The transfer of benefits and encumbrances took place on 31 December 2012. The fair value of the acquired property was €179.80 million, which resulted in an excess of identified net assets acquired over the pur- chase price allocation. This stood at €4.4 million and was recognised under measurement gains/losses. This is off- set by ancillary acquisition costs in connection with the acquisition of the property totalling €9.2 million, which are recognised under measurement gains/losses. Information regarding the revenue and profit generated by the acquired property for the financial year 2012 were not available. CARRYING AMOUNTS FAIR VALUE Acquired property assets 179,760 179,760 Purchase price -176,250 -176,250 Deferred taxes 900 900 Excess of identified net assets acquired over cost of acquisition 4,410 4,410 JOINT VENTURES Joint ventures in which Deutsche EuroShop AG has a majority of the voting rights together with third parties are proportionately included as joint ventures in the consolidated financial statements. Five companies fall into this category as at the balance sheet date. ASSOCIATES In accordance with IAS 28, where Deutsche EuroShop AG can exercise a significant influence but not control over companies these are measured using the equity method, irrespective of the interest held in these companies. Six com- panies fall into this category as at the balance sheet date. INVESTEES Investments over which Deutsche EuroShop AG has neither significant influence nor control are measured at fair value, in line with the provisions of IAS 39. This includes the investment in Ilwro Joint Venture Sp. z o.o., Warsaw. CONSOLIDATION METHODS For purchase accounting, the cost is eliminated against the parent company’s interest in the re-valued equity of the subsidiaries at the date of acquisition or initial consolidation. Any remaining excess of identified net assets acquired over cost of acquisition is recognised as goodwill in intangible assets. Any excess of identified net assets acquired over cost of acquisition is recognised in income following a further reassessment. Joint ventures are included proportionately in the consolidated financial statements in accordance with IAS 31. Alternatively, the equity method is also permissible. The assets and liabilities and the income and expenses of jointly controlled companies are included in the consolidated financial statements according to the interest held in these companies. Proportionate consolidation and accounting for goodwill follows the same principles applied to the con- solidation of subsidiaries. For associates measured in the consolidated financial statements using the equity method, the cost of the investment is recognised in income at an amount increased or reduced by the changes in equity corresponding to the equity interest of Deutsche EuroShop AG. Intragroup transactions are eliminated as part of the consolidation of intercompany balances and of income and expenses. 2012 in € million Total CONSOLIDATED FINANCIAL STATEMENTS { 148 } DES ANNUAL REPORT 2012

DES GB2012 E

Pages