Complex Financial History
Directive Complex Financial History
I. GENERAL PROVISIONS
Art. 1 Purpose
1. The purpose of this Directive is to provide investors with a transparent picture of an issuer’s financial situation at the time of listing in the event the issuer has made or is planning to make significant changes to its structure. The financial circumstances should be presented for a certain period of time prior to the listing according to the requirements for that particular issuer ("track record").
2. The assessment of whether a transparent picture of the issuer’s financial situation has been provided is not necessarily based on the legal form of the issuer’s corporate structure or the transaction itself; rather, it is based mainly on an economic view ("substance over form").
See also:
- Track Record
Art. 2 Scope of Applicability
1. This Directive applies to issuers of equity securities of all regulatory standards.
2. It does not apply to listings of debt securities.
Art. 3 Deviations
If, as a result of the intended or already realised transaction, the financial figures presented in accordance with this Directive fail to transparently portray the corporate structure of the issuer as a whole and could therefore mislead investors, it may be necessary to deviate from the provisions set out below.
Art. 4 Principle
1. If the corporate structure of an issuer has undergone a significant change that has not been presented in the audited financial statements, additional financial figures must be published in the listing particulars according to the provisions set out below.
2. The same applies in the event that the significant structural change arises from a specific intended transaction.
Art. 5 Significant Structural Changes
1. Structural changes are of significance if one of the key figures indicated in Art. 13 corresponds to a change of 25% or more compared to the original structure.
2. In particular, a structural change is present in the following cases:
a. economic continuation of an existing company or business operations in a new legal structure (e.g. creation of a new company into which an existing company or existing business operations are integrated);
b. merger or acquisition using the proceeds from the planned capital-market transaction or contribution in kind;
c. carve-out of operating companies or business operations;
d. the issuer is comprised of companies that were under common control but in the past never prepared consolidated financial figures.
II. DEFINITIONS
Art. 6 Financial Statements
1. Financial statements are deemed to be a superordinate term for historical annual or interim financial statements that comply with one of the recognized accounting standards.
2. The financial statements provide a view of the financial circumstances of the past. Unlike pro forma financial information, financial statements contain no facts that can be expected in the future as a result of the intended transaction or change in structure.
Art. 7 Combined Financial Statements
1. Deemed to be combined financial statements are financial statements that, in the absence of consolidated financial statements, subsequently combine (through addition of financial figures including eliminations) the individual financial statements of companies under common control.
2. If, due to the quality of the assumptions and estimates, no combined financial statements can be drawn up in accordance with one of the accounting standards recognized by MERJ Regulation and in keeping with the "true and fair view" principle, then the individual financial statements are to be presented instead.
Art. 8 Carve-out Financial Statements
1. Deemed to be carve-out financial statements are financial statements that, in the absence of independent financial statements for carved-out companies or business operations, are drawn up on the basis of external or internal financial figures without significant assumptions or adjustments.
2. If, due to the quality of the assumptions and estimates, no carve-out financial statements can be drawn up in accordance with one of the accounting standards recognized by MERJ Regulation and in keeping with the "true and fair view" principle, then the carve-out is to be presented in the pro forma financial information.
Art. 9 Pro Forma Financial Information
1. Within the context of this Directive, pro forma financial information – in contrast to financial statements – merely includes a balance sheet, income statement, and earnings per share as well as notes.
2. In the case of pro forma financial information, financial statements are adjusted by making assumptions in such a manner that, taken in combination with the relevant explanations in the notes, a picture is given as if the transaction or structural change in question had already taken place at the beginning of the period under review. The notes include statements regarding the basis of preparation and each adjustment to the financial statements, including the assumptions that were made. The anticipated synergies may not be taken into account.
III. ADDITIONAL FINANCIAL INFORMATION IN THE LISTING PARTICULARS
Art. 10 Financial statements
1. Financial statements for the last two financial years of the companies or business operations that have led to the significant structural change must be presented in the prospectus if one of the key figures mentioned above corresponds to a change of 25% or more compared to the original structure.
2. The issuer will have to disclose in the prospectus the financial statements as required by the applicable registration document.
3. The financial statements for each of the financial years presented must be audited and the auditors‘ report must be included in the prospectus.
Art. 11 Pro forma financial information
1. In addition to the financial statements, pro forma financial information for the last financial year must be published if one of the key figures corresponds to a structural change of more than 50% or a carve-out of companies or business operations does not fulfil the qualitative requirements for carve-out financial statements.
2. The adjustments made for the pro forma financial information must be presented individually in the
3. form of a tabular reconciliation (Annex 2) and reference must be made to the corresponding notes.
4. An assurance report from an independent auditor (the "pro forma assurance report") is required about the compilation of pro forma financial information.
5. The pro forma assurance report must be printed in the listing particulars.
6. The pro forma assurance report must refer to the basis of preparation for the pro forma financial information, as indicated in the notes, the auditing standard that was applied and the scope of the procedures performed.
7. The pro forma assurance report must also contain the statement that:
a. the pro forma financial information has been compiled, in all material respects, on the basis of the applicable criteria; and
b. this basis is consistent with the accounting policies of the issuer.
Art. 12 Interim financial statements
1. If, at the time the listing particulars is published, the balance sheet date for the last published financial statements lies more than nine months in the past, interim financial statements (in the case of a change of more than 25%) for the companies or business operations that have led to the significant structural change must be published in the listing particulars, as well as interim pro forma financial information (in the case of a change of more than 50%) for the first six months of the current financial year.
2. For interim financial statements, neither an audit nor review is required.
IV. KEY FIGURES FOR ASSESSING STRUCTURAL CHANGES
Art. 13 Calculation of Key Figures
1. The key figures must be calculated on the basis of the most recently audited financial statements, whereby the relevant calculation must be based on identical balance sheet dates and ac- counting periods.
2. The last audited financial statements of the issuer prior to the structural change, taking into account the audited financial statements of the companies or business operations that have led to the significant structural change, form the basis for calculation of the key figures that are applicable subsequent to the structural change.
Art. 14 Formulas
1. The key figures must be calculated on the basis of the most recently audited financial statements, whereby the relevant calculation must be based on identical balance sheet dates and accounting periods.
2. The last audited financial statements of the issuer prior to the structural change, taking into account the audited financial statements of the companies or business operations that have led to the significant structural change, form the basis for calculation of the key figures that are applicable subsequent to the structural change.
3. The key figures are to be calculated according to the following formulas:
a. Profit/Loss
(1) after the structural change
(2) before the structural change
b. Turnover
(1) after the structural change
(2) before the structural change
c. Total Assets
(1) after the structural change
(2) before the structural change
V. FINAL PROVISIONS
Art. 15 Entry into Force
This Directive shall enter into force on 1 Feb 2025.
ANNEX 1
Structural changes
The following abbreviations are used in this Annex: IS (income statement), EPS (earnings per share).
1. Structural change of more than 50%
Year X
Year X-1
Year X-2
Additional financial statements (Art. 11)
If applicable (Art. 16): interim financial statements
Financial statements (audited)
Financial statements (audited)
Pro-forma financial information (Art. 14)
If applicable (Art. 16): interim pro forma financial information (balance sheet, IS, EPS, notes)
· Balance sheet
· IS
· EPS
· Notes
· (Pro forma assurance report)
--
2. Structural change between 25% and 50%
Year X
Year X-1
Year X-2
Additional financial statements
If applicable: interim financial statements
Financial statements (audited)
Financial statements (audited)
3. Structural changes of less than 25%
No additional financial figures (financial statement or pro forma financial information) are required for structural changes of less than 25%.
ANNEX 2
Example regarding structure of pro forma financial information
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