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7.6 Structure of the segment reporting note and reconciliations

Due to the fact that the profits of segments are measured in accordance with the accounting policies of the country of residence of the PZU Group’s company, financial data from segments are disclosed according to several different accounting standards. Moreover, due to significant differences in the formats of management reports submitted to the Management Board of PZU compared to the format of the financial statements prepared under IFRS, two separate reporting formats had to be used: the format of the management reports submitted to the Management Board of PZU (left-hand side of the note) and the format of the financial statements prepared under IFRS (right-hand side of the note).

As a consequence, reconciliation of the totals of revenue and profit or loss of the reportable segments with their consolidated counterparts as required by IFRS 8.28 included in the note is complex and comprises the following stages described in the segment note in the same order as the order of the reconciliation columns:

  • Transition from the format of the management reports submitted to the Management Board of PZU to the format of the financial statements prepared under IFRS (the “Differences in presentation” column), resulting in a number of changes in the presentation, including reclassification of other operating income and expenses to items presented under “operating profit (loss)” in accordance with IFRS;
  • Reconciliation of differences between the accounting standards used for the presentation of differences in financial data of the segments and IFRS, and separate presentation of the key accounting standards;
  • Making consolidation adjustments (since it is the last phase of reconciliation – the adjustments have been presented in the format required under IFRS).