Principles of valuation of assets and liabilities
General accounting principles
Unless otherwise indicated, assets and liabilities are stated at historical cost,
and are reported in thousands of guilders. All assets and liabilities are valued
at nominal value, unless otherwise indicated. Revenues and costs are attri
buted to the year to which they relate.
Transfer and signing on fees
Transfer and signing on fees and related costs regarding players' contracts
for which there are binding agreements have been capitalised as 'transfer
and signing on fees' at a maximum of the expense to third parties, less
depreciation on a straight-line basis. Transfer and signing on fees are depre
ciated over the duration of the contract. The duration of the contracts is
generally between 1 and 5 years. As at the balance sheet date, all contracts
are assessed by the management for permanent impairment. The risk of
unforeseen reductions in the value are not covered by insurance agree
ments.
The remaining capitalised 'transfer and signing on fees' for terminated
players' contracts are charged to the profit and loss account in the same
period as in which sales revenues are recognised.
Reimbursements for continuation of a contract are assessed in the same way
as the consideration for transfers and signing on.
Goodwill
The excess of the acquisition cost of subsidiaries and associated companies
over the net asset values of the company's share in their net assets as at the
dates of acquisition constitutes goodwill. This goodwill is depreciated on a
straight-line basis over 5 years.
Intangible fixed assets
Logo, brand name, image rights and television rights have been obtained at
no cost from the Association and have been valued at nil.
Assets and liabilities are offset within the same tax unity. The current tax
liability is stated under 'taxation and social security contributions'.
Deferred tax assets and liabilities are stated at their nominal value based on
the current tax rates.
Principles of determination of result
Net turnover
The turnover recognised consists of the goods and services supplied to third
parties less sales discounts, returns and value-added taxes.
Cost of sales
The cost of sales consist of the cost of Ajax products which are sold and the
costs of the exploitation of image rights.
Social security contributions
Social security contributions also include pension costs. The pension plan
of the Stichting Contractspelersfonds KNVB (CFK) covers in principle all
contract players.
The pension plan of the Stichting Pensioenfonds voor Voetbaloefenmeesters
covers trainers and coaches.
The pension arrangements of the other staff are with an insurance company.
A defined contribution plan applies to all pension schemes referred to above.
Taxation
Taxation on profits is determined on the basis of the result according to the
profit and loss account, the current tax rates and allowing for permanent
differences between the result according to the profit and loss account and
the fiscal result.
Tangible fixed assets
Tangible fixed assets are carried at cost less depreciation.
Depreciation is calculated on a straight-line basis over the estimated useful
life, taking into account residual value.
Buildings 10 to 20 years
Machinery and equipment 5 years
Other fixed assets 3 to 10 years
Financial fixed assets
Participations in which AFC Ajax NV exercises a significant influence on the
business and financial policy are valued at net asset value. Other participations
are valued at historical cost net of a provision for permanent impairment.
Stock
Stock are stated at historical cost using the fifo (first in, first out) principle
or market value when this value is lower.
Receivables
Receivables are stated at nominal value less a provision for bad debts.
Securities
Trading securities are valued at their market price on the stock exchange as
at the balance sheet date. Unrealised gains and losses are reflected in the
profit and loss account.
Deferred taxation
Deferred tax assets and liabilities resulting from temporary differences
between the commercial and fiscal capital as well as from future tax loss carry
overs are stated in the balance sheet under 'deferred taxation'.
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