AB Akola Group – Annual report – 30 June 2024
Industry: agriculture
All amounts in thousands of euros, unless otherwise stated
2.20. Use of significant accounting judgments and estimates in the preparation of financial statements (extract)
Significant accounting estimates (extract)
Accounting estimates regarding war in Ukraine
• Group operations in Belarus and Russian markets
During previous financial the Group had operations in the Russian market (Wholesale of products for crop growing veterinary products, premixes, and seeds for gardening). In the financial period ended as at 30 June 2024, the Group had limited operations in the market of Russia. Also, the Group has operations in the Belarussian market (Wholesale of products for crop growing veterinary products, premixes, and seeds for gardening). As at the date of these financial statements, the Group had no significant positions of assets or liabilities in these markets. Presented below is the Group‘s summarized exposure as at 30 June 2024 ( in EUR’000):
Revenue from contracts with customers in Russia and Belarus includes only the revenue of one subsidiary registered in Belarus.
Revenue from contracts with customers in Russia for the financial year ended 30 June 2024, amounted to EUR 311 thousand. Revenue from contracts with customers in Belarus for the financial year ended 30 June 2024, amounted to EUR 8,494 thousand.
• Subsidiaries registered in Belarus controlled by the Group
The Group had operations in Belarusian markets through subsidiary OOO KLM (feed materials and feed additives trading, supply of seeds, plant care products, fertilizers, provision of veterinary pharmaceutical services and trade in products).
• Subsidiaries registered in Ukraine controlled by the Group and Group‘s operations in Ukrainian market
The Group conducts operations in the Ukrainian market through its subsidiary, LLC LINAS AGRO UKRAINE (representative office). In February 2022, following the recognition of self-proclaimed republics of Donetsk and Lugansk by the Russian Federation and its subsequent invasion of Ukraine, the military conflict escalated and spread to other regions of that country. As at the date these consolidated financial statements were authorized for issue, the situation in Ukraine is extremely volatile and inherently uncertain.
As at 30 June 2024 Group‘s property, plant and equipment, machinery, inventory, trade and other receivables, other assets, trade, and other liabilities, related to subsidiary operating in Ukraine were not significant. Revenue from contracts with customers during this year ended 30 June 2024 of Group‘s subsidiary, operating in Ukraine was not significant.
The Group‘s revenue from contracts with customers from Ukraine this year ended 30 June 2024 were EUR 8,010 thousand. (30 June 2023 the Group’s revenues from the contracts with the customers were EUR 8,986 thousand).
The Group’s Management has evaluated the following key areas which could be affected by uncertainties caused by the war in Ukraine: going concern, impairment, residual value and useful life of property, plant and equipment, assessment of expected credit losses, net realizable value of inventory, classification of financial instruments as current and non-current, lease contracts. Based on the assessment of the Group’s the effect of the war in Ukraine on financial statements was not significant; however, due to dynamics and volatility of the military operations in Ukraine it is difficult to reliably measure the ultimate financial impact.
Accounts examples 