Review of financial reporting – Schibsted ASA

27 Nov 2024 16:35 CET

Finanstilsynet has reviewed certain topics related to the 2022 and 2023 annual
financial statements of Schibsted ASA. Finanstilsynet has found errors in the
accounting according to the equity method of the investment in the associate
Adevinta ASA, and concerns two matters:
Schibsted recognises its share of the associate's profit or loss with a
three-month delay. In the 2022 annual financial statements Schibsted has not
used the most recent available financial statements for the associate (ref. IAS
28.33), or adjusted for the effects of significant transactions or events that
occur in the associate's available fourth quarter report for 2022 (ref. IAS
28.34), when Schibsted recognises its share of the associate's profit or loss.
Schibsted's recognised share of the associate's profit or loss in the first
quarter of 2023 is a loss of 5 172 MNOK of which the entire loss, or a material
part of the loss, in Finanstilsynet's assessment should have been recognised by
Schibsted in the 2022 annual financial statements.
In the 2023 annual financial statements Schibsted has recognised a reversal of
impairment in the associate amounting to 21 782 MNOK. IAS 28.42 requires that
any reversal of an impairment loss shall be recognised in accordance with IAS 36
to the extent that the recoverable amount of the net investment subsequently
increases. The increase in recoverable amount of the investment in the associate
during 2023 was 16 137 MNOK. It is therefore Finanstilsynet's assessment that
the amount of impairment reversal in the 2023 annual financial statements is
materially misstated, as it materially exceeds the increase in the recoverable
amount of the net investment in the year.
Schibsted does not agree with Finanstilsynet's assessment of the errors.
Finanstilsynet orders Schibsted ASA to correct the errors by publicly disclosing
a corrective note by notifying the Oslo Stock Exchange. The corrective note
shall include an account of the nature of the errors and the consequences for
the financial reports submitted in 2022 and 2023. In its next periodic financial
reporting, the company shall also assess the correction of the errors in
accordance with the rules in IAS 8 Accounting Policies, Changes in Accounting
Estimates and Errors.
Other matters covered by the review revealed weaknesses in Schibsted's
disclosures on estimates used in impairment tests of goodwill and intangible
assets with an indefinite useful life pursuant to IAS 36, as well as weaknesses
in certain disclosures on intangible assets pursuant to IAS 38. For these other
matters, Finanstilsynet has taken note of Schibsted's improvements and
explanations.

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633331_Kontroll av finansiell rapportering Schibsted ASA.pdf