Årsrapport 33771231 PricewaterhouseCoopers Statsautoriseret Revisionspartnerselskab Strandvejen 44 2900 Hellerup 2022-01-01 2021-01-01 2022-12-31 2021-12-31 34594325 RiskPoint Holding A/S Hammerensgade 4, 2. 1267 København K Copenhagen PricewaterhouseCoopers Statsautoriseret Revisionspartnerselskab 33771231 Strandvejen 44 2900 Hellerup Danmark 2023-05-25 Vagn Thorup Regnskabsklasse C, stor virksomhed Revisionspåtegning The Executive Board and Board of Directors have today considered and adopted the Annual Report of RiskPoint Holding A/S for the financial year 1 January - 31 December 2022. The Annual Report is prepared in accordance with the Danish Financial Statements Act. In our opinion the Financial Statements and the Consolidated Financial Statements give a true and fair view of the financial position at 31 December 2022 of the Company and the Group and of the results of the Company and Group operations and of consolidated cash flows for 2022. In our opinion, Management's Review includes a true and fair account of the matters addressed in the Review. We recommend that the Annual Report be adopted at the Annual General Meeting. Copenhagen 2023-05-25 Kenneth Nielsen Executive Officer Vagn Thorup Chairman Ulrik Krogsaa Evers Kenneth Nielsen Lars Peter Thomas Nyström Hans Christian Frick Daniel Christopher Ekdahl To the Shareholders of RiskPoint Holding A/S Opinion In our opinion, the Consolidated Financial Statements and the Parent Company Financial Statements give a true and fair view of the financial position of the Group and the Parent Company at 31 December 2022 and of the results of the Group’s and the Parent Company’s operations and of consolidated cash flows for the financial year 1 January - 31 December 2022 in accordance with the Danish Financial Statements Act. We have audited the Consolidated Financial Statements and the Parent Company Financial Statements of RiskPoint Holding A/S for the financial year 1 January - 31 December 2022, which comprise income statement, balance sheet, statement of changes in equity and notes, including a summary of significant accounting policies, for both the Group and the Parent Company, as well as consolidated statement of cash flows (”the Financial Statements”). Basis for Opinion We conducted our audit in accordance with International Standards on Auditing (ISAs) and the additional requirements applicable in Denmark. Our responsibilities under those standards and requirements are further described in the ”Auditor’s responsibilities for the audit of the Financial Statements” section of our report. We are independent of the Group in accordance with the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (IESBA Code) and the additional ethical requirements applicable in Denmark, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Management is responsible for Management’s Review. Our opinion on the Financial Statements does not cover Management’s Review, and we do not express any form of assurance conclusion thereon. In connection with our audit of the Financial Statements, our responsibility is to read Management’s Review and, in doing so, consider whether Management’s Review is materially inconsistent with the Financial Statements or our knowledge obtained during the audit, or otherwise appears to be materially misstated. Moreover, it is our responsibility to consider whether Management’s Review provides the information required under the Danish Financials Statements Act. Based on the work we have performed, in our view, Management’s Review is in accordance with the Consolidated Financial Statements and the Parent Company Financial Statements and has been prepared in accordance with the requirements of the Danish Financial Statements Act. We did not identify any material misstatement in Management’s Review. Management is responsible for the preparation of consolidated financial statements and parent company financial statements that give a true and fair view in accordance with the Danish Financial Statements 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. In preparing the Financial Statements, Management is responsible for assessing the Group’s and the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting in preparing the Financial Statements unless Management either intends to liquidate the Group or the Company or to cease operations, or has no realistic alternative but to do so. Our objectives are to obtain reasonable assurance about whether the Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Financial Statements. As part of an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: Identify and assess the risks of material misstatement of the Financial Statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Obtain an understanding of internal control relevant to the audit 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 Company’s and the Group’s internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management. Conclude on the appropriateness of Management’s use of the going concern basis of accounting in preparing the Financial Statements and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s and the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the Financial Statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group and the Company to cease to continue as a going concern. Evaluate the overall presentation, structure and contents of the Financial Statements, including the disclosures, and whether the Financial Statements represent the underlying transactions and events in a manner that gives a true and fair view. Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the Consolidated Financial Statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Hellerup 2023-05-25 Hellerup 2023-05-25 PricewaterhouseCoopers Statsautoriseret Revisionspartnerselskab Jesper Otto Edelbo State Authorised Public Accountant mne10901 Casper Larsen State Authorised Public Accountant mne45855 Seen over a five-year period, the development of the Group is described by the following financial highlights: The ratios have been prepared in accordance with the recommendations and guidelines issued by the Danish Society of Financial Analysts. For definitions, see under accounting policies.The ratios have been prepared in accordance with the recommendations and guidelines issued by the Danish Society of Financial Analysts. For definitions, see under accounting policies. 305200000 203638000 170341000 138277000 61089000 51811000 -700000 -383000 -2423000 -1201000 -461000 105081000 43871000 39604000 765809000 528689000 384582000 164504000 95450000 68969000 108004000 69550000 131633000 -422000 -7320000 -14065000 -1651000 2000 -12000 34000 -11000 -36854000 -23972000 -28502000 18214000 75269000 70728000 38258000 89066000 Årets forskydning i likvider Årets forskydning i likvider Årets forskydning i likvider Årets forskydning i likvider Årets forskydning i likvider 101 86 72 79.9 88.4 90.4 84.8 83.4 16 42.7 45.7 30 30.4 6.2 14.7 18.2 11.6 13.5 21.6 17.8 21.5 18.1 17.9 22.5 71.3 80.8 53.4 65.4 Key activities RiskPoint Group is an underwriting agency. We focus on providing value-adding insurance solutions predominately to Nordic and European corporates and industrial clients and their advisors. Aside from insurance solutions within traditional lines of businesses, we also focus on establishing and developing insurance solutions within niche areas such as directors liability, renewable energy, intellectual rights and company transactions (W&I). Development in the year The income statement of the Group and Parent Company for 2022 shows a profit of DKK 53,777,095 and 24,383,470 respectively, and at 31 December 2022 the balance sheet of the Group and Parent Company shows equity of DKK 269,402,377 and 350,546,121 respectively. The result for the year is impacted by staff expenses related to significant one-off bonuses, incentive contributions and transactions costs associated with a sale of a 40% share of the Company to Nordic Capital. The result is considered to be satisfactory given these costs. The past year and follow-up on development expectations from last year Revenue for the period is 7.5% below budget and 17.6% above 2021.The increase in revenue vs. prior year was driven by increases in most business lines except Property following a restructure of the portfolio and W&I which saw a significant decline in business opportunities during 4Q 2022. Excluding Profit Commission, W&I and Renewable Energy the growth rate was 16.3%. Operating expenses were significantly impacted by costs associated with the sale of 40% of the Company to Nordic Capital. Excluding one-off costs, operating expenses are in line with expectations. Subsidiaries and Branch offices RiskPoint Group has subsidiaries in Denmark, Sweden, Norway and Finland as well as USA and Singapore. Further the Company has branch office representations in the following countries: Germany, UK, Switzerland, Spain, Holland and France. Foreign exchange risks Activities abroad cause results and equity to be affected by the exchange and interest rate development of a number of currencies. No hedging of the Company's currency is made since the risk is not assessed to be high. Targets and expectations for the year ahead Management expect revenue to increase by 15-20% excluding Profit Commission, W&I and Renewable Energy. The increase is expected across all business lines however there is uncertainty around how the turmoil in the financial markets will impact the W&I business and Renewable Energy is heavily depending on construction of major wind farms. Extraordinary investments will be made in order to further expand new and existing activities in branches and subsidiaries outside Denmark. The focus will be on Asia, USA/Canada and south Europe. In addition, investments in IT and implementation of new solutions will take place in 2023. These investments will have limited positive effect on the expected result for 2023 but is a key component to the company’s growth journey. Management expectation for 2023 is a result of DKK 225 – 275 million before tax for the Group. External environment As an insurance agency, our climate footprint is relatively limited. Therefore, RiskPoint has not prepared a defined climate and environmental policy, but finds that a responsible approach to climate and the environment is of course part of running a business and an important element for our customers, business partners and stakeholders. Statement of corporate social responsibility ref. Danish Financial Statements act section 99a Statement on gender composition ref. Danish Financial Statements Act section 99b Statement on data ethics ref. Danish Financial Statements Action section 99d Data is and will remain the foundation of the insurance industry and the ethical considerations of collection, storage, usage and sharing data is a key aspect of acting as a responsible insurance business. RiskPoint has implemented a Data Protection Policy as a matter of group policies, describing roles and responsibilities, how RiskPoint manages in particular personal data and how compliances is ensured. Data ethics is an embedded part of this policy, where the respect of privacy and confidentiality of our customers, business partners, and stakeholders serves as on of our key drivers to build long-term relationships offering bespoke insurance products by processing only necessary data for the purpose of which they are collected. Unusual events The financial position at 31 December 2022 of the Group and the results of the activities and cash flows of the Group for the financial year for 2022 have not been affected by any unusual events. Subsequent events No events materially affecting the assessment of the Annual Report have occurred after the balance sheet date. It is important to RiskPoint Group that we act environmentally, socially and economically responsible in corporation with our customers, business partners and stakeholders. RiskPoint Group’s risks of having impacts on the areas stipulated by the Danish Business Authorities regarding environment, social- and employee relationships, anti-corruption and bribe, and humans rights is assessed to be limited. Environment RiskPoint Group is aware of potential risks associated with the environment and climate change. We assess our business operations to have emission-related environmental impacts while climate change also poses increasing financials risks towards our operations. Personal relationships with brokers, insured and other stakeholders are key to run a successful insurance agency business. The Company is focused on the emission and energy consumption associated with travel however compared to prior year the Company unfortunately saw an uplift in travel activity during 2022 following the Corona lock-down. RiskPoint Group is committing to reduce its environmental footprint, both in terms of greenhouse gas emissions and energy consumption. We aim to regularly monitor energy consumption and utilize modern power-saving solutions regarding both energy consumption and energy sourcing. RiskPoint strive to reduce emissions by optimizing work processes within numerous areas, such as limiting paper consumption by issuing documentation electronically and using energy efficient appliances throughout our locations. The goal for 2023 is to set measurable targets to monitor our progress in these areas. Governance Based on RiskPoint Group conducting business in highly regulated markets, we assess the risks of exposure to possible breaches of human rights and anti-corruption as limited. RiskPoint is part of the financial service industry and therefore, our corporate governance policies are considered business critical. We have established a governance and corporate compliance programs covering areas such as data protection, financial crime prevention and treating customers fairly. We have implemented policies following the standard of the London Insurance Market, including Lloyd’s and are audited by Lloyd’s markets as well as internal compliance. We assess these internal policies and guidelines to be so extensive that we have decided not to formulate separate policies for human rights and anti-corruption and bribe. Social RiskPoint Group acknowledge the risks related to retaining and attracting skilled employees. RiskPoint aims to positively influence its own employees and society at large. One of the focus areas has been to assess and develop a framework for career development and annual performance assessment to be implemented throughout RiskPoint. During 2022 a significant uplift in our capabilities has been implemented and today we offer a vast number of internal- and external courses to our employees covering both work management, managerial development, culture and job specific skills. Our people are the single most important asset of the company. RiskPoint invests in diverse talent and education through our Global Trainee program which seeks to develop and support emerging talents in the insurance industry. RiskPoint plans to further develop and establish this program throughout its locations. A balanced gender representation in Board of Directors and management positions is important to the Company. As of the 31st of December 2022, The Board of Directors of RiskPoint Holding A/S consisted of 6 men. The target is that at least 2 of the 6 members of the Board of Directors and Executive Board level are women by 2025. For the financial year 2022, the target has not been met as there have been no ordinary replacement of board members elected by the general meeting. RiskPoint Group promotes gender equality in management positions through initiatives such as flexible working schedules and locations, internal moves and promotions as well as trainee programs for future leadership pipeline. The Company realize that it will require a targeted journey the coming years to reach a more desired gender mix and as of today female managers constituted 26% of the managerial workforce. 482166536 400870002 0 0 0 819457 0 0 96940408 47289193 9220799 158750 385226128 354400266 -9220799 -158750 305643761 180765593 857428 0 2324332 2510783 0 0 77258035 171123890 -10078227 -158750 0 0 36019228 123587232 10668259 3463332 2097977 1349827 11368647 3846013 4387033 4425779 76557647 170741209 23651945 120352530 22780552 38118994 -731525 -48224 53777095 132622215 24383470 120400754 680112 2756039 0 0 5506947 3172403 0 0 6187059 5928442 0 0 1434869 2364 0 0 1434869 2364 0 0 0 0 37410021 126844575 3376870 2564223 0 0 3376870 2564223 37410021 126844575 10998798 8495029 37410021 126844575 822805464 801069593 0 0 0 0 259477884 49939917 827720 986478 50 0 21709864 0 731524 0 3165753 0 0 0 3031258 0 0 48242 12481427 4460930 0 0 864021486 806517001 260209458 49988159 370250427 352036701 53843072 24473032 1234271913 1158553702 314052530 74461191 1245270711 1167048731 351462551 201305766 670981 671955 670981 671955 670981 671955 670981 671955 -3521944 0 0 0 272253340 119496347 349875140 107473450 0 87500000 0 87500000 269402377 207668302 350546121 195645405 0 597683 0 0 0 597683 0 0 4388870 6192544 0 0 4388870 6192544 0 0 250 140 0 0 832251911 868593274 59002 162033 5349055 20883136 0 0 0 2302926 0 0 133878248 60810726 857428 5498328 971479464 952590202 916430 5660361 975868334 958782746 916430 5660361 1245270711 1167048731 351462551 201305766 671955 0 0 122072507 87500000 0 0 0 -2576160 0 9616 29798594 0 0 0 -10590 0 0 10590 0 0 -83495826 4004174 -4004174 0 0 -3521944 0 0 35770155 0 53777095 0 -29798594 29798594 0 0 0 29396385 670981 0 -3521944 272253340 0 671955 0 0 126301645 87500000 0 0 0 -18828194 0 9616 29798594 0 0 0 -10590 0 0 10590 0 0 -83495826 4004174 -4004174 0 0 0 -2448735 0 35770155 0 0 0 150883441 0 0 24383470 0 -29798594 29798594 670981 0 0 349875140 0 53777095 132622215 22283328 41946525 5324878 28110494 81385301 202679234 10668259 3463332 11368653 3846013 80684907 202296553 39755729 34319080 40929178 167977473 2334544 2058360 1650910 -2127 812647 259745 -4798101 -2315978 -110 38 -35770155 57046734 0 12486836 29808210 0 83495826 43706696 -17917351 -90392086 18213726 75269409 352036701 276767292 370250427 352036701 370250427 352036701 Geographical segments Revenue, Denmark 294,469,785 276,056,616 0 0 Revenue, Europe 137,747,732 111,709,095 0 0 Revenue, Rest of the world 49,949,019 13,104,291 0 0 482,166,536 400,870,002 0 0 Business segments Commission based revenue 456,644,850 389,477,234 0 0 Other revenue 25,521,686 11,392,768 0 0 482,166,536 400,870,002 0 0 258360119 153280869 743650 0 7729296 6515284 0 0 39126721 20570255 113778 0 427625 399185 0 0 305643761 180765593 857428 0 154 127 0 0 Remuneration to the Board of Directors and Executive Board amounts to DKK 6,555,918 (2021: DKK 2,997,560). 2075927 2420382 0 0 248405 90401 0 0 2324332 2510783 0 0 0 0 2097976 1349827 3766922 2532030 0 0 6901337 931302 1 0 6709096 2226599 261644 3810601 4659551 1619414 4125389 615178 11368647 3846013 4387033 4425779 44048261 37582747 0 -48242 -22897694 111994 -731524 0 1629985 424253 -1 18 22780552 38118994 -731525 -48224 17105486 9260210 0 2334544 17105486 11594754 14349447 6087807 2075927 0 16425374 6087807 680112 5506947 6552843 1650910 8203753 6520479 248405 6768884 1434869 10905746 13183182 500000 0 0 -2277436 11405746 10905746 115938829 95962955 -2448735 944196 36019228 123255703 -138878347 -104178800 0 -2322661 15373300 -2125454 0 4402890 26004275 115938829 Riskpoint A/S Denmark 100 Riskpoint AB Sweden 100 Riskpoint OY Finland 100 Riskpoint AS Norway 100 2564223 812647 3376870 The following receivables fall due for payment more than 1 year after year end 119,349,157 103,962,757 0 0 Prepayments consist of prepaid expenses concerning rent, insurance premiums, subscriptions, staff costs and interest. A-shares 66136500 661365 B-shares 961553 9616 C-shares 1 0 In 2022, the Company sold shares at a nominal value of 42,874, corresponding to 6.4%, which has been transferred to retained earnings under equity. The payments paid and received are included in the "Statements of Changes in Equity". The Company holds shares with a nominal value of DKK 3,360 corresponding to 0.5% of the total capital. These shares have not been cancelled and are therefore held as treasury shares. The Company may choose to sell these shares at a later time. The shares have been acquired as part of the Company's strategy. In 2022, The Company has also cancelled treasury shares at a nominal value of DKK 10,590. 0 87500000 0 87500000 53777095 45122215 24383470 32900754 Deferred tax asset at 1 January -597,683 -486,769 0 0 Amounts recognised in the income statement for the year 22,897,694 -111,994 731,524 0 Effect from merger and acqusitions (residual) -590,147 1,080 0 0 Deferred tax asset at 31 December 21,709,864 -597,683 731,524 0 Recognition of deferred tax assets relates to unutilised tax losses which the Group expects to utilise in the coming financial years. 4388870 6192544 0 0 2441541 5088730 0 0 6830411 11281274 0 0 -10668259 -3463332 11368647 3846013 2324332 2510783 22780552 38118994 -3521944 934067 -29597607 -326299023 34922485 354409517 5324878 28110494 Rental and lease obligations Obligations under rental contract. Total future rent payment: Within 1 year 5,970,704 10,801,042 0 0 Between 1 and 5 years 11,843,218 13,689,170 0 0 17,813,922 24,490,212 0 0 Guarantee obligations RiskPoint A/S has issued a security to Danske Bank for intercompany balances with the Company's Parent Company RiskPoint Holding A/S 15,000,000 15,000,000 0 0 The subsidiaries of RiskPoint Holding A/S has provided an unlimited guarantee to the Parent Company RiskPoint Holding A/S under which the guarantor assumes joint and several liability. Other contingent liabilities RiskPoint Holding A/S has issued a letter of subordination to it's subsidiary RiskPoint AS in which the Parent Company's receivable subsides for other creditors. The letter is valid until 31 December 2023. The group companies are jointly and severally liable for tax on the jointly taxed incomes etc of the Group. The total amount of corporation tax payable is disclosed in the Annual Report of RP PartnerCo A/S, which is the management company of the joint taxation purposes. Moreover, the group companies are jointly and severally liable for Danish withholding taxes by way of dividend tax, tax on royalty payments and tax on unearned income. Any subsequent adjustments of corporation taxes and withholding taxes may increase the Company’s liability. Basis Controlling interest RP PartnerCo A/S Parent Company Other related parties RiskPoint A/S Subsidiary RiskPoint AB Subsidiary RiskPoint AS Subsidiary RiskPoint OY Subsidiary RP Underwriting Inc. Affiliated Company Caplloyd A/S - Forsikringsagentur Affiliated Company RiskPoint PTE Limited Affiliated Company RiskPoint Solutions Ltd. Affiliated Company Executive board and Board of directors Key management personnel Transactions The Company has chosen only to disclose transactions which have not been made on an arm’s length basis in accordance with section 98(c)(7) of the Danish Financial Statements Act. The Company is included in the Group Annual Report of the Parent Company: Name Place of registered office RP PartnerCo A/S (mindste koncern) Hammerensgade 4, 2., DK-1267 København K No events materially affecting the assessment of the Annual Report have occured after the balance sheet date. 733842 487585 24500 21700 189965 87340 11500 10400 286600 294575 106900 47400 The Annual Report of RiskPoint Holding A/S for 2022 has been prepared in accordance with the provisions of the Danish Financial Statements Act applying to large enterprises of reporting class C . The accounting policies applied remain unchanged from last year. The Consolidated and Parent Company Financial Statements for 2022 are presented in DKK. Correction of material misstatements In connection with changes in the ownership and group structure of the RiskPoint Group in 2022 a revised assessment of a market consistent valuation method related to shares acquired from employees leaving as shareholders as well as employees joining as shareholders in the parent RiskPoint Holding A/S has been made. On the basis of the revised assessment, the measurement of staff expenses in the RiskPoint Group for previous years have been materially misstated. Accordingly, the comparative numbers have been corrected. The correction relates to 2021 and has resulted in a reduction in Income from investments in subsidiaries and Investments in subsidiaries of DKK 18,828k in the Parent company and increase in payroll expenses of DKK 3,078k and a reduction in Income tax of DKK 502k in the Group. The effect on Equity at 31 December, 2021 is a reduction of DKK 18,828k in the Parent company and DKK 2,576k in the Group. Accounting estimates According to terms defined in binder contracts, a profit commission accrues to RiskPoint. Due to the nature of insurance business and the emergence of insurance events the estimation of profit commission earned involves accounting estimates, which are dependent on future events and developments. These estimates are made by Management on the basis of historic experience and other assumptions, which Management consider to be prudent and realistic. Due to the inherent nature of the estimates, the assumptions applied may be incomplete and unexpected future events and developments may occur, which give rise to subsequent adjustment of the estimates made. Revenues are recognised in the income statement as earned. Furthermore, value adjustments of financial assets and liabilities measured at fair value or amortised cost are recognised. Moreover, all expenses incurred to achieve the earnings for the year are recognised in the income statement, including depreciation, amortisation, impairment losses and provisions as well as reversals due to changed accounting estimates of amounts that have previously been recognised in the income statement. Assets are recognised in the balance sheet when it is probable that future economic benefits attributable to the asset will flow to the Company, and the value of the asset can be measured reliably. Liabilities are recognised in the balance sheet when it is probable that future economic benefits will flow out of the Company, and the value of the liability can be measured reliably. Assets and liabilities are initially measured at cost. Subsequently, assets and liabilities are measured as described for each item below. The Consolidated Financial Statements comprise the Parent Company, RiskPoint Holding A/S, and subsidiaries in which the Parent Company directly or indirectly holds more than 50% of the votes or in which the Parent Company, through share ownership or otherwise, exercises control. Enterprises in which the Group holds between 20% and 50% of the votes and exercises significant influence but not control are classified as associates. On consolidation, items of a uniform nature are combined. Elimination is made of intercompany income and expenses, shareholdings, dividends and accounts as well as of realised and unrealised profits and losses on transactions between the consolidated enterprises. The Parent Company’s investments in the consolidated subsidiaries are set off against the Parent Company’s share of the net asset value of subsidiaries stated at the time of consolidation. Business combinations Business acquisitions carried through on or after 1 July 2018 Acquisitions of subsidiaries are accounted for using the purchase method under which the identifiable assets and liabilities of the entity acquired are measured at fair value at the time of acquisition. Acquired contingent liabilities are recognised at fair value in the Consolidated Financial Statements to the extent that the value can be measured reliably. The time of acquisition is the time when the Group obtains control of the entity acquired. The cost of the entity acquired is the fair value of the consideration agreed, including consideration contingent on future events. Transaction costs directly attributable to the acquisition of subsidiaries are recognised in the income statement as incurred. Positive differences between the cost of the entity acquired and identifiable assets and liabilities are recognised as goodwill in intangible assets in the balance sheet and are amortised in the income statement on a straight-line basis over their estimated useful lives. Amortisation of goodwill is allocated in the Consolidated Financial Statements to the operations to which goodwill is related. Where the differences are negative, they are recognised immediately in the income statement. Where the purchase price allocation is not final, positive and negative differences from acquired subsidiaries due to changes to the recognition and measurement of identifiable net assets may be adjusted for up to 12 months after the time of acquisition. These adjustments are also reflected in the value of goodwill or negative goodwill, including in amortisation already made. Where cost includes contingent consideration, this is measured at fair value at the time of acquisition. Contingent consideration is subsequently measured at fair value. Any value adjustments are recognised in the income statement. In respect of step acquisitions, any previously held investments in the entity acquired are remeasured at fair value at the time of acquisition. The difference between the carrying amount of the investment previously held and the fair value is recognised in the income statement. Pooling of interests Intragroup business combinations are accounted for under the pooling-of-interests method. Under this method, the two enterprises are combined at carrying amounts, and no differences are identified. Any consideration which exceeds the carrying amount of the acquired enterprise is recognised directly in equity. The pooling-of-interests method is applied at the date of acquisition, and comparative figures have not been restated. All leases are considered operating leases. Payments made under operating leases are recognised in the income statement on a straight-line basis over the lease term. Transactions in foreign currencies are translated at the exchange rates at the dates of transaction. Exchange differences arising due to differences between the transaction date rates and the rates at the dates of payment are recognised in financial income and expenses in the income statement. Where foreign exchange transactions are considered hedging of future cash flows, the value adjustments are recognised directly in equity. Receivables, payables and other monetary items in foreign currencies that have not been settled at the balance sheet date are translated at the exchange rates at the balance sheet date. Any differences between the exchange rates at the balance sheet date and the rates at the time when the receivable or the debt arose are recognised in financial income and expenses in the income statement. Fixed assets acquired in foreign currencies are measured at the transaction date rates. Information on business segments and geographical segments based on the Group´s risks and returns and its internal financial reporting system. Business segments are regarded as the primary segments. The value of share-based payment, including share option and warrant plans that do not involve an outflow of cash and cash equivalents, offered to the Executive Board and a number of senior employees is recognised in equity. Other external expenses comprise indirect production costs and expenses for premises, sales and distribution as well as office expenses, etc. Staff expenses comprise wages and salaries as well as payroll expenses. The Group’s incentive program is accounted for as an equity-based incentive program. Amortisation, depreciation and impairment losses comprise amortisation, depreciation and impairment of intangible assets and property, plant and equipment. Other operating income and other operating expenses comprise items of a secondary nature to the main activities of the Group, including gains and losses on the sale of intangible assets and property, plant and equipment. The item “Income from investments in subsidiaries” in the income statement includes the proportionate share of the profit for the year. Financial income and expenses are recognised in the income statement at the amounts relating to the financial year. Tax for the year consists of current tax for the year and changes in deferred tax for the year. The tax attributable to the profit for the year is recognised in the income statement, whereas the tax attributable to equity transactions is recognised directly in equity. The Company is jointly taxed with with the Danish group companies. The tax effect of the joint taxation is allocated to Danish enterprises in proportion to their taxable incomes. Property, plant and equipment are measured at cost less accumulated depreciation and less any accumulated impairment losses. Cost comprises the cost of acquisition and expenses directly related to the acquisition up until the time when the asset is ready for use. Interest expenses on loans raised directly for financing the construction of property, plant and equipment are recognised in cost over the period of construction. Depreciation based on cost reduced by any residual value is calculated on a straight-line basis over the expected useful lives of the assets, which are: Other fixtures and fittings, tools and equipment 3-5 years The fixed assets’ residual values are determined at nil. Depreciation period and residual value are reassessed annually. The carrying amounts of intangible assets and property, plant and equipment are reviewed on an annual basis to determine whether there is any indication of impairment other than that expressed by amortisation and depreciation. If so, the asset is written down to its lower recoverable amount. Investments in subsidiaries are recognised and measured under the equity method using the consolidation principle. The item“Investments in subsidiaries” in the balance sheet include the proportionate ownership share of the net asset value of the enterprises calculated on the basis of the fair values of identifiable net assets at the time of acquisition with addition of the remaining value of any increases in value and goodwill calculated at the time of acquisition of the enterprises. The total net revaluation of investments in subsidiaries is transferred upon distribution of profit to “Reserve for net revaluation under the equity method“ under equity. The reserve is reduced by dividend distributed to the Parent Company and adjusted for other equity movements in the subsidiaries. Subsidiaries with a negative net asset value are recognised at DKK 0. Any legal or constructive obligation of the Parent Company to cover the negative balance of the enterprise is recognised in provisions. Other fixed asset investments consist of deposits. Receivables are measured in the balance sheet at the lower of amortised cost and net realisable value, which corresponds to nominal value less provisions for bad debts. Trade receivables comprise premiums collected with policyholders on behalf of the Company´s carriers. When recognising these receivables, the amount owed to the carrier net of sales commission is reognised as well. Prepayments comprise prepaid expenses concerning rent, insurance premiums, subscriptions and interest. Dividend distribution proposed by Management for the year is disclosed as a separate equity item. Treasury shares Purchase and sales prices for treasury shares are recognised directly in retained earnings under equity. A reduction of capital by cancellation of treasury shares reduces the share capital by an amount equal to the nominal value of the shares and increases retained earnings. Dividend on treasury shares is recognised directly in equity under retained earnings. Deferred income tax is measured using the balance sheet liability method in respect of temporary differences arising between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes on the basis of the intended use of the asset and settlement of the liability, respectively. Deferred tax assets are measured at the value at which the asset is expected to be realised, either by elimination in tax on future earnings or by set-off against deferred tax liabilities within the same legal tax entity. Deferred tax is measured on the basis of the tax rules and tax rates that will be effective under the legislation at the balance sheet date when the deferred tax is expected to crystallise as current tax. Any changes in deferred tax due to changes to tax rates are recognised in the income statement or in equity if the deferred tax relates to items recognised in equity. Current tax liabilities and receivables are recognised in the balance sheet as the expected taxable income for the year adjusted for tax on taxable incomes for prior years and tax paid on account. Extra payments and repayment under the on-account taxation scheme are recognised in the income statement in financial income and expenses. Other debts are measured at amortised cost, substantially corresponding to nominal value. Trade payables comprise premium payables to the Company´s carriers. When collecting premiums, the amount owed to the carrier, equivalent to the premium collected net of commission, is recognised. The cash flow statement shows the Group´s cash flows for the year broken down by operating, investing and financing activities, changes for the year in cash and cash equivalents as well as the Group´s cash and cash equivalents at the beginning and end of the year. Cash flows from operating activities Cash flows from operating activities are calculated as the net profit/loss for the year adjusted for changes in working capital and non-cash operating items such as depreciation, amortisation and impairment losses, and provisions. Working capital comprises current assets less short-term debt excluding items included in cash and cash equivalents. Cash flows from investing activities Cash flows from investing activities comprise cash flows from acquisitions and disposals of intangible assets, property, plant and equipment as well as fixed asset investments. Cash flows from financing activities Cash flows from financing activities comprise cash flows from the raising and repayment of long-term debt as well as payments to and from shareholders. Cash and cash equivalents The cash flow statement cannot be immediately derived from the published financial records. Cash and cash equivalents comprise ”Cash at bank and in hand”. Goodwill acquired is measured at cost less accumulated amortisation. Goodwill is amortised on a straight-line basis over its useful life, which is assessed at 5 years. 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Danish Financial Statements Action section 99d Data is and will remain the foundation of the insurance industry and the ethical considerations of collection, storage, usage and sharing data is a key aspect of acting as a responsible insurance business. RiskPoint has implemented a Data Protection Policy as a matter of group policies, describing roles and responsibilities, how RiskPoint manages in particular personal data and how compliances is ensured. Data ethics is an embedded part of this policy, where the respect of privacy and confidentiality of our customers, business partners, and stakeholders serves as on of our key drivers to build long-term relationships offering bespoke insurance products by processing only necessary data for the purpose of which they are collected.