Note 1 – Principles
1.1 General Aspects
These financial statements were prepared according to the provisions of the Swiss Law on Accounting and Financial Reporting (32nd title of the Swiss Code of Obligations). Where not prescribed by law, the significant accounting and valuation principles applied are described below.
1.2 Financial Assets
Financial assets include short- and long-term loans to subsidiaries and associates. Loans granted in foreign currencies are translated at the rate at the balance sheet date.
1.3 Treasury Shares
Treasury shares are recognized at acquisition cost and deducted from shareholders’ equity at the time of acquisition. In case of a resale, the gain or loss is recognized through the shareholders’ equity as increase or decrease of available earnings brought forward.
1.4 Share-based Payments
When treasury shares are used for share-based payment programs, the difference between the acquisition costs and any consideration paid by the employees at grant date is recognized as other financial expenses or income.
1.5 Short-/Long-Term Interest-Bearing Liabilities
Interest-bearing liabilities are recognized in the balance sheet at nominal value. Discounts and issue costs for bonds or syndicate loans are recognized as prepaid expenses and amortized on a straight-line basis over the principal’s maturity period. Premiums are recognized as accrued expenses and amortized on a straight-line basis over the principal’s maturity period.
1.6 Currency- and Interest-Related Instruments
Currency- and interest-related instruments with a short-term holding period are valued at their fair value as at the balance sheet date. A valuation adjustment reserve has not been accounted for.
1.7 Presentation of a Cash Flow Statement and Additional Disclosures in the Notes
As Lonza Group Ltd has prepared its consolidated financial statements in accordance with a recognized accounting standard (International Financial Reporting Standards IFRS), it has decided to forgo presentation of a cash flow statement, information on interest-bearing liabilities and audit fees in the note disclosures as would be required by Swiss law.