Tauron – 36. Assets held for sale and liabilities associated with assets held for sale

SELECTED ACCOUNTING PRINCIPLES The Group classifies a non-current asset (or disposal group) as held for sale if it meets the following criteria: representatives of the competent governing body of the Company are committed to implement the plan to sell, the assets are available for immediate sale in their current status, subject only to normal and customary terms for sale, an active programme to locate a potential buyer has been initiated, the sale is highly probable and may be performed within 12 months of the decision, the sales price is reasonable in relation to the current fair value, it is unlikely that the plan to dispose of such assets will be significantly changed. Fixed assets or groups of assets classified as held for sale are measured at the lower of the carrying amount and the fair value less costs of sales, except for deferred tax assets, assets arising from employee benefits and financial assets within the scope of IFRS 9 Financial Instruments. PROFESSIONAL JUDGEMENT AND ESTIMATES The Group recognises the impairment loss upon initial or subsequent revaluation of an assets (or a disposal group) to the fair value less disposal costs.

SELECTED ACCOUNTING PRINCIPLES

The Group classifies a non-current asset (or disposal group) as held for sale if it meets the following criteria:

representatives of the competent governing body of the Company are committed to implement the plan to sell,
the assets are available for immediate sale in their current status, subject only to normal and customary terms for sale,
an active programme to locate a potential buyer has been initiated,
the sale is highly probable and may be performed within 12 months of the decision,
the sales price is reasonable in relation to the current fair value,
it is unlikely that the plan to dispose of such assets will be significantly changed.

Fixed assets or groups of assets classified as held for sale are measured at the lower of the carrying amount and the fair value less costs of sales, except for deferred tax assets, assets arising from employee benefits and financial assets within the scope of IFRS 9 Financial Instruments.

PROFESSIONAL JUDGEMENT AND ESTIMATES

The Group recognises the impairment loss upon initial or subsequent revaluation of an assets (or a disposal group) to the fair value less disposal costs.

Table 1

Export to Excel

	As at 31 December 2020	As at 31 December 2019
Disposal group assets classified as held for sale, including:	1,829,617	–
Property, plant and equipment	1,433,918	–
Right-of-use assets	89,380	–
Other non-current assets	40,954	–
Inventories	97,195	–
Receivables from buyers	110,331	–
Other current assets	57,839	–
Other non-current assets classified as held for sale	73,459	22,710
Total	1,903,076	22,710
Disposal group liabilities classified as held for sale, including:	487,617	–
Accruals, deferred income and government grants	95,295	–
Other non-current liabilities	110,370	–
Provisions for liabilities due to energy certificates and CO 2 emission allowances	136,098	–
Other current provisions	24,153	–
Other current liabilities	121,701	–
Other liabilities directly related to non-current assets classified as held for sale	8,369	8,936
Total	495,986	8,936

Net assets of TAURON Ciepło Sp. z o.o.

The disposal group classified as held for sale consists mainly of the net assets of TAURON Ciepło Sp. z o.o., which is described in more detail in Note 19 to these consolidated financial statements.

As at the balance sheet date, the Group assessed that in relation to the assets and liabilities of TAURON Ciepło Sp. zo.o., the prerequisites resulting from IFRS 5 Non-current Assets Held for Sale and Discontinued Operations in the scope of classification of the above assets as disposal group held for sale were met, in particular the net assets are, in the opinion of the Company, available for immediate sale in their present condition subject only to the terms and conditions that are usual and customary for sale. Therefore, the Group reclassified the assets and liabilities of TAURON Ciepło Sp. z o.o. as a disposal group, respectively, to the following positions: assets classified as assets held for sale and liabilities directly related to assets classified as held for sale. As at the date of the above reclassification of the disposal group and as at the balance sheet date, the Group measured it at a fair value, as described more broadly in Note 19 to these consolidated financial statements. The fair value was estimated at a level of PLN 1,342,000 thousand. Due to the fact that the fair value is lower than the existing carrying amount of the disposal group of PLN 2,167,708 thousand, the Group recognised an impairment loss of PLN 825,708 thousand on non-financial non-current assets, which decreased the value of:

property, plant and equipment in the amount of PLN 775,885 thousand,
right-of-use assets in the amount of PLN 48,339 thousand,
intangible assets in the amount of PLN 1,484 thousand.

Shares in PGE EJ 1 Sp. z o.o.

Other assets classified as held for sale represent mainly shares in PGE EJ 1 Sp. z o.o.

As at the balance sheet date, the Group assessed that in relation to the shares in PGE EJ 1 Sp. z o.o. the prerequisites resulting from IFRS 5 Non-current Assets Held for Sale and Discontinued Operations in the scope of classification of the above assets as held for sale were met, in particular the shares are, in the Group’s opinion, available for immediate sale in their present condition subject only to the terms and conditions that are usual and customary for sale; therefore, as at 31 December 2020 the Group reclassified the shares in PGE EJ 1 Sp. z o.o. to assets classified as held for sale. As at the balance sheet date, the Group carried out a fair value measurement of shares in PGE EJ 1 Sp. z o.o., which was estimated at PLN 53,136 thousand, based on information gathered in the course of the sale process of shares in PGE EJ 1 Sp. z o.o.