Vedior N.V. is domiciled in the Netherlands and is quoted on the stock exchange of Euronext Amsterdam and included in the AEX index. The consolidated financial statements of the Company for the year ended 31 December 2007 comprise the Company and its subsidiaries. Where in this report is referred to ‘Vedior’, the ‘Company’ or the ‘Group’ this relates to Vedior N.V. and its subsidiaries. Where in this report is referred to ‘Vedior N.V.’, this relates to the Company only.
All information in these financial statements is in millions of Euro, unless stated otherwise.
2 Intended merger with Randstad
On 3 December 2007, Randstad Holding nv and Vedior N.V. announced that a conditional agreement was reached of a possible combination of the two companies that will be achieved by means of a public offer for the outstanding shares of Vedior in a mixed cash and share exchange offer in 2008.
On 28 December 2007, Randstad Holding nv and Vedior announced that the preparations for the recommended public offer for outstanding shares of Vedior are well under way. Randstad Holding nv and Vedior expect to submit the offer memorandum to the Authority Financial Markets in the Netherlands within the statutory time frame, i.e. before 25 February 2008.
In this annual report no effects from the possible combination have been included as this is a conditional agreement.
3 Statement of compliance
The consolidated financial statements have been prepared in compliance with International Financial Reporting Standards (‘IFRS’) and the interpretations adopted by the International Accounting Standards Board (‘IASB’) as endorsed by the European Union.
4 Adoption of new and revised standards
Vedior adopted all new and revised Standards and Interpretations issued by the International Accounting Standards Board (‘IASB’) and the International Financial Reporting Interpretations Committee (‘IFRIC’) of the IASB that are relevant to its operations and effective for annual reporting periods beginning on 1 January 2007. Specifically Vedior has adopted IFRS 7 ‘Financial Instruments: Disclosures’, effective from 1 January 2007. The adoption of IFRS 7 has no effect on the balance sheet or the income statement. The effects are limited to additional disclosures in the notes to the financial statements. The comparative figures have been adjusted accordingly.
For 2007 no other new or revised Standards were relevant for Vedior’s operations and therefore have no impact on this or prior year’s balance sheet or income statement. The Standards and Interpretations that were in issue but not yet effective for reporting periods beginning on 1 January 2007 were not adopted. Vedior anticipates that the adoption of these Standards and Interpretations will have no material financial impact on the financial statements of the Group in future periods.
5 Significant accounting principles
5.1 Basis of preparation The financial statements are presented in Euro. They are prepared on the historical cost basis, except for provisions that are measured at present value, the liability for deferred consideration and derivative financial instruments that are measured at fair value.
The accounting policies set out below have been applied consistently to all periods presented in the consolidated financial statements.
5.2 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 the power to govern the financial and operating policies as to obtain benefits from its activities. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.
Intragroup balances and any unrealised gains and losses or income and expenses arising from intragroup transactions, are eliminated in preparing the consolidated financial statements.
Foreign currencies
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (‘the functional currency’). The consolidated financial information is presented in Euro, which is Vedior’s presentation currency.
In preparing the financial statements of individual entities, transactions in foreign currencies are translated at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are translated to Euro at the foreign exchange rate ruling at that date. Non monetary items that are measured in terms of historical cost in foreign currency are not retranslated. Foreign exchange differences arising on translation are recognised in the income statement except for exchange differences on transactions entered into in order to hedge certain foreign currency risks (see Financial risks and hedging). Exchange differences on monetary items receivable from or payable to a foreign operation for which settlement is neither planned nor likely to occur are recognised in equity, and recognised in profit and loss on disposal of the net investment.
For the purpose of presenting consolidated financial statements, the assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on consolidation, are translated to Euro at foreign exchange rates ruling at the balance sheet date. The revenues and expenses of foreign operations are translated to Euro at rates approximating to the foreign exchange rates ruling at the dates of the transaction, being the monthly average exchange rate. The resulting translation adjustments are recorded as exchange differences within equity.