Verðbréfaskráning Íslands hf.

Transcription

1 Financial Statements 2012 Laugavegi Reykjavík Id. No.:

2 Index DRAFT Board of Director's Report... Independent Auditor's Report... Statement of Income... Balance Sheet... Statement of Cash Flows... Notes Financial Statements December 31,

3 Board of Director's Report The Financial Statements are prepared in accordance with the Icelandic Financial Statements Act. The Icelandic Securities Depository is a registry, a depository and a clearing house for the settlement of securities in dematerialised form in accordance with Act no 131/1997. According to the Income Statement profit for the year 2012 amounted to ISK million. According to the Balance Sheet total Shareholder's equity amounted to ISK million. Further information regarding the disposal of the profit from the Income Statement is accounted for in the Statement of Changes in Shareholder's Equity. The board of Directors proposes to pay out a dividend amounting to 235 million to the shareholders in the year 2013, and the remaining profit to be allocated as indicated in the Financial Statements. Eignarhaldsfélag Verðbréfaþings hf. holds 99,9% of the Share Capital of No changes were in shares or in shareholders ownership during the year. The main risk faced is related to liquidity risk, credit risk and market risk. Liquidity risk is the risk that the company will not be able to meet its financial obligations as they fall due. The Company's approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company's reputation. It is the company s policy to have at any given time minimum available cash or highly liquid assets. Short-term loans to group parties, cash and bank holdings are such assets. These assets represented approximately 93% of the company s assets at year end 2012 and far exceeded the company s liabilities. Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company's receivables from customers. The Company s exposure to credit risk is influenced mainly by the individual characteristics of each customer. Approximately 53% of the Company s revenue is attributable to sales transactions with its five largest customers. Market risk is the risk arising from the impact of changes in market prices on the value of the company's assets and liabilities. This include currency risk that stems mainly from transactions with non-domestic group Companies. The Board of Directors of and the CEO hereby confirm the Financial Statements for the year 2012 with their signatures. Stockholm, 22 March Board of Directors of : Hans Ole Jochumsen, Chairman Catharina L. B. Hovemyr Bo Johan Magnus Billing Teuvo Tarmo Tapio Rossi Einar Snorri Sigurjónsson Chief Executive Officer of Financial Statements December 31,

4 Independent Auditor's Report To the board of directors and shareholders of We have audited the accompanying financial statements of which comprise the balance sheet as at 31 December 2012, income statement, statement of cash flow for the year then ended, and a summary of significant accounting policies and other explanatory notes. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with the Icelandic Annual Financial Statement Act, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements give a true and fair view of the financial position of Verðbréfaskráning Íslands hf. as at 31 December 2012, and of its financial performance and its cash flows for the year then ended in accordance with the Icelandic Financial Statement Act. Confirmation of the Board of Director s report Pursuant to the requirement of Item 5, Paragraph 1 Article 106 of the Icelandic Financial Statement Act no. 3/2006, we confirm to the best of our knowledge that the accompanying board of director s report includes all information required by the Icelandic Financial Statements Act that is not disclosed elsewhere in the financial statements. Reykjavík, 22 March Margrét Pétursdóttir State Authorized Public Accountant Ernst & Young ehf. Borgartúni Reykjavík Verðbréafaskráning Íslands hf. Financial Statements December 31,

5 Statement of Income for the Year 2012 Notes Operating revenues Revenues from main operation Operating expenses Operating expenses Operating profit Financial income (expenses) Financial income and expense Profit before income tax Income tax... 7 ( ) ( ) Profit for the year Financial Statements December 31, Amounts are in ISK

6 Balance Sheet as at 31 December 2012 Notes Assets Equipment Deferred tax asset Total non-current assets Accounts receivables, related companies Accounts receivables, other Prepayments Cash and cash equivalents Total current assets Total assets Shareholder's equity Share capital Statutory reserve Retained earnings Total shareholder's equity Current liabilities Trade and other payables, related companies Income tax payable Other payables Total current liabilities Total shareholder's equity and liabilities Verðbréfaskráning Íslands hf Financial Statements December 31, Amounts are in ISK

7 Statement of Cash Flows for the Year 2012 Notes Cash flows from operating activities Profit for the year... Depreciation... Financial income and expense... Income tax... Decrease in account receivables and prepayments... (Decrease) increase in account payables ( ) ( ) ( ) Interest received Interest expense paid... ( ) ( ) Income tax paid... ( ) ( ) Cash flows provided by operating activities Cash flows from investing activities Changes in loans and receivables to related companies... ( ) Investment in equipment... 0 ( ) Net cash used in investing activities ( ) ( ) Cash flows to financing activities Dividend paid to shareholders... ( ) 0 Net cash reduction of financing activities ( ) 0 Increase in cash and cash equivalents... Cash and cash equivalents at the beginning of year... Cash and cash equivalents at the end of year Investing and financing activities not affecting cash flow Trade and other payable, related company... Dividend paid to shareholders ( ) Verðbréfaskráning Íslands hf Financial Statements December 31, Amounts are in ISK

8 Notes 1. Reporting entity (The Company) is domiciled in Iceland. The address of the registered office is Laugavegur 182, 105 Reykjavík. The Company is a registry, a depository and a clearing house for the settlement of securities in dematerialised form in accordance with Act no 131/1997. The Company is a subsidiary of Eignarhaldsfélag Verðbréfaþings hf. The consolidated accounts can be located at the parent company's office which is based at Laugavegur 182, 105 Reykjavík. The ultimate parent company is Nasdaq OMX Group Inc. USA. 2. Basis of preparation a. Statement of compliance The Financial Statements are prepared in accordance with the Icelandic Financial Statements Act. The financial statements were authorised for issue on March 22, 2013 by the Company s board of directors. b. Basis of measurement The Financial Statements have been prepared on the historical cost basis. c. Functional and presentation currency The Financial Statements are presented in Icelandic Krona (ISK), which is the Company's functional currency. 3. Significant accounting policies The accounting policies set out below have been applied consistently to all periods presented in these financial statements. a. Foreign currency Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are retranslated at the exchange rate ruling at the balance sheet date. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at the year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Income Statement. b. Use of estimates and judgements The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities. Use of available information and application of judgement are inherent in the formation of estimates. Actual results in the future could differ from such estimates and the differences may be material to the financial statements. c. Equipment Recognition and measurement Operating assets are stated at cost less accumulated depreciation and impairment losses. Subsequent cost The company recognises in the carrying amount of an item of operating assets the cost of replacing part of such an item when that cost is incurred if it is probable that the future economic benefits embodied with the item will flow to the company and the cost of the item can be measured reliably. All other costs are recognised in the Income Statement as an expense as incurred. Depreciation Depreciation on assets is calculated using the straight-line method to allocate the cost of each asset to its residual value over its estimated useful life, as follows: Machinery, equipment and vehicle years The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date. Financial Statements December 31, Amounts are in ISK

9 Notes, continued 3. Significant accounting policies (continued) d. Accounts receivables Accounts receivables are initially recognised at the transaction price. They are subsequently measured at amortised cost less provision for impairment. A provision for impairment of trade receivables is established when there is objective evidence that the Company will not be able to collect all amounts due according to the original terms of the receivables. e. Cash and cash equivalents Cash and cash equivalents consist of demand deposits with credit institutions. f. Trade and other payables Trade and other payables are measured at amortised cost. g. Revenue recognition Revenues from main operation consists of annual fees, income from foreign custody, service fees, safekeeping fees and transaction fees. Annual fees are recognised ratably over the following 12 month period. Entry fees comprise initial listing fees, listing of additional shares fees and annual fees from shares and bonds. Initial listing fees and additional shares fees are recognised when the listing process is finished. Income from foreign custody is recognised in the income statement as revenue when earned. Service fee is recognised in the income statement as revenue when earned. Safekeeping fees are a given percentage of the value of securities in custody. If the securities are traded on a regulated market or an MTF the reference value is the market price of the securities in question. Otherwise face value is used as the basis for the safekeeping fee. The fees are collected monthly. Transaction fees are charged for executing trades on the exchange market. The transaction fee is charged per executed order and as per value traded. Transaction fees are recognised as transactions occur. Finance income comprises interest income from bank accounts. Interest income is recognised on a time proportion basis. h. Expenses Operations and maintenance IT and other operating expenses Operations and maintenance consist of expenses from leasing of software and hardware and expenses from operation of various information systems. Other operating expenses according to the Income Statement consist of foreign communication cost, premises expenses, administration expenses, consultancy expenses and other operating expenses. Financial expenses Financial expenses are recognised in the Income Statement as they accrue. i. Income tax Income tax expense comprises current and deferred tax. Income tax expense is recognised in the Income Statement except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity. Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted (or substantially enacted) at the reporting date, and any adjustment to tax payable in respect of previous years. Deferred tax is recognised using the balance sheet method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date. A deferred tax asset is recognised to the extent that it is probable that future taxable profits will be available against which temporary difference can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised. Financial Statements December 31, Amounts are in ISK

10 Notes, continued 4. Revenues Annual fees Income from foreign custody Safe keeping fees Service fees Transaction fees Other revenue Operating expenses Salary Pension premiums Salary- related expenses Other operating expenses... Average number of employees... Key management compensation Financial income and Financial expense Financial income and financial expenses are specified as follows: Interest income Foreign exchange difference ( ) Interest expense... ( ) ( ) Income tax Income tax recognised in the Income Statement Current tax expenses... Deferred tax expenses... Other changes... Total income tax expense for the period ( ) ( ) ( ) Equipment Total value at 1 January Additions during the year Total value at 31 December Previously depreciated... Depreciation for the year... Total depreciation 31 December... Book value 31 December Operating lease agreements The company has entered into lease agreements on it's premises. Commitments due to these contracts amount to approximately ISK million for the next 10 years. Lease payments in the amount of ISK 10.0 million are entered as expense in the Income Statement Financial Statements December 31, Amounts are in ISK

11 Notes, continued 10. Shareholder's equity According to the company's Articles of Association total share capital amounted to ISK 65.0 million. Issued shares at year-end numbered ISK 65.0 million (2011: 65.0 million) and are all paid for. The owners of ordinary shares are entitled to dividends as declared from time to time and are entitled to one vote per share of one ISK at meetings of the Company. The share capital is divided into shares of ISK 1, each with equal rights within a single class of shares. 11. Shareholder's Equity Changes in Shareholder's Equity is specified as follows: Balance at 1 January Profit for the year... Dividends... Balance at 31 December Share Statutory Retained Capital reserve earnings Total ( ) ( ) Statutory reserve According to Icelandic Companies Act, 25% of the nominal share capital must be held in a statutory reserve and can not be distributed as dividend to shareholders. The purpose of the reserve is to meet possible accumulated deficit. 13. Deferred income tax asset Deferred income tax asset is specified as follows: Deferred income tax asset at the beginning of the year... Adjustments... Expensed income tax... Current tax... Deferred income tax asset at year end... Deferred income tax asset is specified as follows: Equipment... Accounts receivables... Other... Deferred income tax asset at year end ( ) ( ) ( ) ( ) ( ) ( 4.129) Events after the Balance Sheet date There have been no material post Balance Sheet date events that would require disclosure or adjustments to the 31 December 2012 Financial Statements. 15. Key ratios Current assets / Current liabilities... 2,8 2,7 Profit for the year as a % of operating income... 42,2% 37,1% Shareholders equity as a % of total assets... 64,2% 62,5% Return on equity... 44,7% 40,1% Financial Statements December 31, Amounts are in ISK

12 Notes, continued 16. Related party transactions Nasdaq OMX Nordic Oy. Helsinki, Finland, owns 100% of the shares of Eignarhaldsfélag Verðbréfaþings hf., which owns 99,9% of the shares of The following transactions were carried out with related parties: Sale of services and interest revenue: Nasdaq OMX Treasury, interest revenue OMX Broker Service AB OMX AB Stockholm Purchases of services: OMX Technology AB... Kauphöll Íslands hf.... Nasdaq OMX Group, New York... Other related companies... Year-end balances arising from sales / purchase of goods / services: Receivables from related parties: Nasdaq OMX Treasury AB... Other related companies... Payables to related parties: Eignarhaldsfélagið Verðbréfaþing hf.... Other related companies The receivables from related parties arise mainly from short term loans. Average interest during 2012 is 5.2%. The payables to related parties arise mainly from unpaid dividend to the parent company. Because of the currency control the company hasn t been able to pay unpaid dividend. Unpaid dividend will be paid as the currency control will be lifted. The payables bear no interest. Financial Statements December 31, Amounts are in ISK