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Annual Report 2024
Annual Report 2024
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1. Basis of presentation, consolidation and general accounting policies

Basis of presentation

Precious Woods Group (hereinafter referred to as “the Group” or “­Precious Woods”) is one of the leading companies in sustainable management of tropical forests globally. The parent company, Precious Woods Holding Ltd, has its registered office in Zug. The Group’s subsidiaries are organized and operate under the laws of Brazil, Gabon, Netherlands and Luxembourg.

The consolidated financial statements for the Precious Woods Group have been prepared on a historical cost basis, except for leasing, biological assets and land, that have been measured at fair value, and in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board (IASB).

The consolidated financial statements are presented in euros, as the Group’s revenues, profits and cash flows are principally denominated in euros. All values are rounded to the nearest thousand (in thousand EUR), except when otherwise indicated. The functional currency of the parent company Precious Woods Holding Ltd is swiss francs.

Due to rounding, numbers presented throughout this report may not add up precisely to the totals provided. All ratios and variances are calculated using the underlying amount rather than the presented rounded amount.

Significant accounting judgments, estimates and assumptions

The preparation of the consolidated financial statements requires Group Management to make estimates and assumptions that affect the reported amounts of assets and liabilities and of revenues and expenses during the reporting period. The resulting accounting estimates will, by definition, rarely equal the related actual results.

The estimates and assumptions, which may have a significant risk of causing a material impact on the consolidated financial statements, relate primarily to

  • Biological assets (see Note 11),
  • Leasing and right-of-use assets (see Note 21),
  • Deferred income tax assets (see Note 28),
  • Land titles in Brazil (see Note 10),
  • Provisions (see Note 26),
  • Contingencies (see Note 27),
  • Defined benefit obligations (see Note 29) and
  • Goodwill (see Note 12)

New or revised IFRS standards, amendments and interpretations

Certain IFRS and interpretations were revised or introduced. The relevant ones for the Group are,

effective on or after 1 January 2024:
  • IAS 1 Presentation of financial statements (narrow-scope amendments) – These amendments had no impact on the consolidated financial statements.
  • IAS 7 Statement of cash flows and IFRS 7 Financial instruments (­narrow-scope amendments) – These amendments had no impact on the consolidated financial statements.
  • IFRS 16 Lease (amendments) – This amendment had no impact on the consolidated financial statements.
effective on or after 1 January 2025:
  • IAS 21 The effects of changes in foreign exchange rates (amendments) – effective on or after 1 January 2025 – no material impact expected
  • IFRS 9 Financial Instruments and IFRS 7 Financial Instruments: Disclosures (amendments) – effective on or after 1 January 2026 – no material impact expected
  • IFRS 18 Presentation and disclosure in financial statements – effective on or after 1 January 2027 – the Group is currently working to identify possible impacts on the consolidated financial statements.

The material general accounting policies are as follows:

a. Currency

The subsidiaries’ accounting records are maintained in the legal currency of the country in which they operate and which is their functional currency. Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the transaction dates. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized through profit or loss. The currency translations rates are presented in Note 30.

The financial statements of the subsidiaries have been translated from their functional currencies to the presentation currency (EUR).

b. Impairment of non-financial assets

The Group assesses at each year-end reporting date whether there is an indication that an asset may be impaired. Such assessment occurs on the basis of events or changes in circumstances, which indicate that the value of an asset may be impaired. If such indications exist, the recoverable amount will be determined for the respective asset. If the asset does not generate cash inflows that are largely independent from other assets, the recoverable amount is determined on the lowest group of assets for which cash inflows are separable. An impairment loss is recognized, if the carrying value exceeds the recoverable amount. The recoverable amount is the higher of value in use and fair value less costs of disposal. The impairment is recorded in the statement of comprehensive income.

All specific accounting policies may be found adjacent to the corresponding note on the following pages.