Accounting Principles

Kuoni Travel Holding Ltd. (the Company) is domiciled in Zurich. The consolidated financial statements for the year ended 31 December 2010 comprise the Company and all its subsidiaries (Kuoni Group) and associates. The Company is one of Europe’s leading tourism companies, active in the leisure travel and destination management field. The consolidated financial statements are prepared in accordance with International Financial Reporting Standards (IFRS) and comply with Swiss law.

Basis of Preparation

The consolidated financial statements are presented in Swiss francs (CHF), rounded to the nearest thousand. The consolidated financial statements are prepared on the historical cost basis except for derivative financial instruments, financial assets and financial instruments available for sale, which are stated at their fair value. Non-current assets and discontinued operations held for sale are stated at the lower of the carrying amount and fair value less costs to sell.

The preparation of the consolidated financial state- ments in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Critical judgements made by management in the application of IFRS that have a significant effect on the financial statements and key sources of estimation uncertainties are discussed separately. The accounting policies have been applied consistently to all periods presented in these consolidated financial statements, with the exceptions described below.

Adoption of New and Revised Standards

The Kuoni Group adopted new and revised standards and new interpretations with effect from 1 January 2010:

Revised standards:

  • IFRS 2: Share-based payment (Accounting of Group share-based payments with cash settlement)
  • IFRS 3: Business combinations
  • IAS 27: Consolidated and separate financial statements
  • IAS 39: Financial Instruments: Recognition and measurement (Eligible hedged items)
  • Improvements to IFRSs (April 2009)

New interpretations:

  • IFRIC 17: Distribution of Non-cash Assets to Owners

With the exception of IFRS 3, the adoption and application of the above standards and interpretations had no effect on these consolidated financial statements.

The adoption and application of the revised IFRS 3 resulted in directly expensed acquisition costs instead of capitalising them.