Statutory Audit Report and Auditors’ Report
Key Audit Matter
Summary of the Audit Approach
Business Combinations
Disclosures related with business combinations
are presented in note 5 of consolidated financial
statements.
As disclosed in financial statements during 2016,
Ibersol acquired Eat Out Group, having recognized a
Goodwill of 70,6 million euros as of December 31st
2016.
The accounting of this business combination is
complex, due to judgements made in the application
of accounting standards, namely valuation of assets
and liabilities identified and consequent calculation of
Goodwill.
As of 31 de December 2016, in the context of the
acquisition process of the control of Eat Out Group,
brands were identified which are in process of valuation
at fair value through a set of relevant estimatives and
judgements, based in economic and market indicators,
namely, the definition of future cash flows and discount
rate to be used, among others.
The expression of the amounts involved and the level
of judgement associated to the valuation of assets and
liabilities acquired, require the definition of a set of
complex estimatives and assumptions by management,
which justifies that this matter was considered by us as
a key audit matter.
The audit procedures that we performed related to this
matter were, namely, the following :
- Obtain and analyse the share purchase agreement in
order to understand the terms and conditions of the
transaction and assessment the compliance of IFRS 3
- Business combinations;
- Analyse of assessment model prepared by
management with the objective of valuation of
the acquired business and the involvement of ours
specialists in capital markets in order to assess the
assumptions and methodologies used by management;
- Analyse of inputs included in assessment model,
including growth rates forecasted and discount rates;
- Analyse of the rational to consider the calculation of
goodwill on a provisory basis, in consequence of not
being finalized the assessment of the valuation of the
totality of assets and liabilities identified.
We also reviewed disclosures made, in accordance with
accounting standards applicable and on the basis of
what was considered as relevant.
Statutory Audit Report
December 31st 2016
Ibersol, S.G.P.S., S.A.
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