Notes for P&L

Note 1 Critical accounting policies

All amounts in millions of Swedish kronor (SEK M) unless otherwise stated.

Basis of presentation

The consolidated accounts comprise Fingerprint Cards AB (Publ) (the Parent Company) and its subsidiaries (the Group). The consolidated accounts have been prepared in accordance with International Financial Reporting Standards (IFRS®/IAS) issued by the International Accounting Standards Board (IASB) as endorsed by the EU. The Swedish Financial Reporting Board's recommendation RFR 1 (Supplementary Accounting Rules for Groups) has also been applied.

The consolidated statement of comprehensive income and statement of financial position and the Parent Company income statement and balance sheet will be subject to adoption by the Annual General Meeting (AGM) on 28 May 2025.

The accounting policies are stated in the introduction to each note. The focus is on reviewing the accounting decisions the Group has made within the auspices of the applicable IFRS principle and avoiding repeating body text, unless considered of particular importance to understanding note content. Those accounting policies without a specific note are stated in Note 1.

Consolidation principles

Subsidiaries

The consolidated accounts comprise Fingerprint Cards AB (publ) (the Parent Company) and its subsidiaries (the Group). Subsidiaries are companies that are under the controlling influence of the Parent Company. A controlling influence is secured when the Parent Company has control over the investment, is exposed or entitled to a variable return from its holding in the company and can exercise control over the investment to influence the return. All subsidiaries are wholly owned through direct or indirect ownership, and accordingly, are considered to lie under the Group's control.

Translation to Swedish kronor on consolidation of companies in with different functional currencies

Subsidiaries prepare their financial statements in each entity's functional currency. Each Group company's functional currency is determined on the basis of the primary economic environment where the company conducts operations. The Parent Company's functional currency is Swedish kronor, which is also the presentation currency of the Parent Company and Group. This means that the financial statements are presented in Swedish kronor. All amounts are in millions of Swedish kronor unless otherwise stated.

Receivables and liabilities in foreign currency

Exchange rate differences are recognized in net profit for the year. Exchange rate differences on operating receivables and operating liabilities are recognized in operating profit and exchange rate differences on financial receivables and financial liabilities are recognized in net financial income/expense.

Critical estimates and judgments

With its Audit Committee, management has discussed the progress, selection and disclosure of the Group's critical accounting policies and estimates, as well as the application of these principles and estimates. Pursuant to IAS 1, the company should disclose the assumptions and other important sources of uncertainty in estimates, which if actual outcomes differ, can have a material impact on the financial statements. In cases where this occurs, estimates and judgments have been moved to the relevant note. A summary of the areas that management considers to contain material estimates and judgments follow:

  • Deferred tax (Note 12)
  • Capitalization of development costs (Note 14)
  • Impairment testing of goodwill and other intangible assets (Note 14)
  • Inventory valuation (Note 16)

New accounting policies

New accounting policies for 2024

Those amendments applying for the financial year beginning 1 January 2024 did not have any material effect on the financial statements.

New accounting policies 2025 and later

Certain new standards, interpretations and amendments have been published but had not yet entered into force on 31 December 2024 and in some cases have not been adopted by the EU.

With the exception of IFRS 18, the Group assesses that these amendments will not have a material effect on the financial statements.

IFRS 18 Presentation and Disclosure in Financial Statements replaces IAS 1 Presentation of Financial Statements. IFRS 18 establishes new requirements for the presentation of financial statements, with a particular focus on:

  • Income statement: Requirements for certain mandatory subtotals are introduced as operating profit. Revenues and expenses will be classified in the income statement into five categories: operating, financing, investing, income tax and discontinued operations
  • Aggregation and disaggregation of information, including the introduction of overarching principles for how information should be aggregated and disaggregated in the financial statements.
  • Disclosure of key performance indicators (MPMs) shall be provided in a single note, with reconciliations to the nearest IFRS-compliant subtotal.

IFRS 18 will be effective for annual periods beginning on or after 1 January 2027, with early adoption permitted. Companies will need to restate comparative periods. With regard to IFRS 18, the Group has not yet assessed its impact on the Group's financial reporting. IFRS 18 will not have any impact on the recognition and measurement of the Group's transactions, but will only affect the Group's presentation and presentation of the financial statements, including the financial statements and notes. IFRS 18 may also affect the key figures presented and how they are calculated.

Classification and presentation formats

Earnings for the Group are recognized in the statement of comprehensive income, and for the Parent Company, in the income statement. In addition, the Parent Company uses the terms balance sheet and cash flow statement for the statements the Group refers to as the statement of financial position and statement of cash flows respectively. The Parent Company balance sheet has been presented according to the format stipulated in the Swedish Annual Accounts Act, while the statement of comprehensive income, the statement of changes in equity and the cash flow statement are based on IAS 1 Presentation of Financial Statements, and IAS 7 Statement of Cash Flows.

 

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