ACCOUNTING RULES
Finance income and finance costs
Interest income and costs are recognised successively over the respective period using the effective interest method in relation to the net amount of the financial instrument at the reporting date, in line with the materiality principle.
Dividends are recognised when the shareholders’ right to receive payments is established.
| Year ended December 31, 2021 |
Year ended December 31, 2020 |
|
|---|---|---|
| NET FINANCE INCOME/(COSTS) FROM FINANCIAL INSTRUMENTS | ||
| Dividends | 3 | 2 |
| Interest, including | (307) | (269) |
| Interest income calculated using the effective interest rate method | 35 | 32 |
| Revaluation of financial assets | (33) | 12 |
| Reversal/(recognition) of impairment | (7) | 1 |
| Exchange differences | (4) | (33) |
| Loss on disposal of investment | (6) | (13) |
| Settlement of loss of control | 324 | – |
| TOTAL NET FINANCE COSTS) FROM FINANCIAL INSTRUMENTS | (30) | (300) |
| NET OTHER FINANCE INCOME/(COSTS) | ||
| Interest cost on non-financial items | (219) | (229) |
| Interest on statutory receivables | 2 | (1) |
| Reversal of provisions | (1) | (1) |
| Other | (2) | (11) |
| TOTAL NET OTHER FINANCE INCOME/(COSTS) | (220) | (242) |
| TOTAL NET FINANCE INCOME/(COSTS) | (250) | (542) |
Result on the loss of control is related to Ørsted’s acquisition of a 50% stake in the increased share capital of EWB 2 and EWB 3. The transaction is described in greater detail in notes 1.3 and 33.3 to these financial statements.
Interest costs mainly relate to outstanding bonds, credit facilities, loans, settled IRS transactions and leases. The interest cost on lease liabilities reached PLN 40 million in the current report (PLN 42 million in 2020). The interest cost on non-financial items concerns land rehabilitation provisions and employee benefit provisions.