Hindustan Unilever Limited · NSE:HINDUNILVR

Hindustan Unilever — Investor Presentation (December 2015)

27 slides from Hindustan Unilever's investor presentation, Dec 7, 2015

  1. Slide 1: Ind AS Implementation: Preliminary Impact Assessment on HUL Financial Statements

    IND AS IMPLEMENTATION PRELIMINARY IMPACT ASSESSMENT ON HUL FINANCIAL STATEMENTS 7th December, 2015

  2. Slide 2: Contents

    CONTENTS Context Scope of the Presentation Key Ind AS Standards with an Impact on HUL Draft Ind AS Opening Balance Sheet Draft Ind AS JQ’15 restated Statement of Profit and Loss Preliminary Impact Summary

  3. Slide 3: Context

    CONTEXT Companies having a net worth of Rs. 500 crores or more (as per the MCA notification standalone financial statements as on 31st March, 2014) are required to dated comply with Ind AS in the preparation of their financial statements for 16.02.2015 accounting periods beginning on or after 1st Ap

  4. Slide 4: Ind AS Implementation

    IND AS IMPLEMENTATION COMPARATIVES: Indian GAAP restated to Ind AS Quarterly reporting as per Ind AS (incl. quarterly reporting) PY 15-16 comparatives restated to Ind AS Last Indian GAAP Financial Statements First Ind AS Financial Statements 1 April 2015 31 March 2016 1 April 2016 31 March 2017 Open

  5. Slide 5: Scope of the Presentation

    SCOPE OF THE PRESENTATION  This presentation has the objective to provide information on the expected impact of transition to Ind AS on the Company’s reported equity and reported profit.  Impacts contained herein are preliminary as full compliance with Ind AS effective as at 31.03.2017 is required

  6. Slide 6: Key Ind AS Standards with an Impact on HUL

    KEY IND AS STANDARDS WITH AN IMPACT ON HUL ON DRAFT IND AS OPENING B/S AND DRAFT JQ’15 IND AS RESTATED P/L

  7. Slide 7: Key Ind AS Standards with an Impact on HUL

    KEY IND AS STANDARDS WITH AN IMPACT ON HUL Ind AS 1 : Presentation of Financial Statements Ind AS 10 : Events after Reporting Period Ind AS 12 : Income Taxes Ind AS 18 : Revenue (exposure draft) Ind AS 19 : Employee Benefits Ind AS 28 : Investment in Associates and Joint Ventures Ind AS 37 : Provisi

  8. Slide 8: Ind AS 1: Presentation of Financial Statements

    Ind AS 1 : Presentation of Financial Statements  New Components of Financial Statements - Statement of Changes in Equity for the year. - ‘Other Comprehensive Income’ section in the Statement of Profit and Loss for the year.  Distinction between Financial and Non-Financial assets/liabilities Illust

  9. Slide 9: Other Comprehensive Income (OCI)

    OTHER COMPREHENSIVE INCOME (OCI) • Other comprehensive income comprises items of income and expense that are not recognised in profit or loss as required or permitted by other Ind AS. • OCI balance is presented in the ‘Other Equity’ section of the Balance Sheet separately from retained earnings. Com

  10. Slide 10: Ind AS 10: Events after Reporting Period

    Ind AS 10 : Events after Reporting Period IGAAP Ind AS The Company accounted for a provision for proposed final dividend (including dividend The Company will recognise a liability for final distribution tax) relating to a given financial year dividend (including dividend distribution tax) in the in

  11. Slide 11: Ind AS 12: Income Taxes

    Ind AS 12 : Income Taxes IGAAP Ind AS Deferred taxes are recognised for the tax effect of Deferred taxes are recognised for future tax timing differences between accounting income consequences of temporary differences between and taxable income for the year i.e., income the carrying value of assets

  12. Slide 12: Ind AS 18: Revenue (exposure draft)

    Ind AS 18: Revenue (exposure draft) IGAAP Ind AS  New Revenue Definition –The Company will recognise revenue at the fair value Under IGAAP, the of consideration received or receivable. Any sales incentive, discounts or Company accounted rebates in any form, including cash discounts given to custome

  13. Slide 13: Ind AS 19: Employee Benefits

    Ind AS 19 : Employee Benefits IGAAP Ind AS The Company recognised the investment in the *HURB *HURB trust qualifies and will be recognised as a Trust as non-current investment at cost of Rs. 350cr as it ‘plan asset’ under Ind AS 19. did not qualify as ‘plan asset’ under AS 15 on employee benefits. T

  14. Slide 14: Ind AS 28: Investments in Associates and Joint Ventures

    Ind AS 28 : Investments in Associates and Joint Ventures IGAAP Ind AS The Company used ‘proportionate consolidation’ The Company will account for its joint venture, method to account for its joint venture, Kimberly Kimberly Clark Lever Private Limited using the Clark Lever Private Limited in its con

  15. Slide 15: Ind AS 37: Provisions, Contingent Liabilities and Contingent Assets

    Ind AS 37 : Provisions, Contingent Liabilities and Contingent Assets IGAAP Ind AS  The Company will discount provisions to their The Company recognised provisions at an present value where the effect of time value of undiscounted value as current IGAAP principles money is material. explicitly prohi

  16. Slide 16: Ind AS 38: Intangible Assets

    Ind AS 38: Intangible Assets IGAAP Ind AS The useful life of an intangible asset cannot be The useful of an intangible asset like indefinite under IGAAP principles. The Company brand/trademark can be indefinite. Not required to amortised brand/trademark on a straight line be amortised and only teste

  17. Slide 17: Ind AS 101: First-time Adoption of Indian Accounting Standards

    Ind AS 101: First-time Adoption of Indian Accounting Standards The standard setting out how to adopt Ind AS for the first time – first time adoption rules, exemptions and options  Recognise assets and liabilities as required by Ind AS.  Derecognise assets and liabilities not General Principle perm

  18. Slide 18: Ind AS 101: First-time Adoption of Indian Accounting Standards

    Ind AS 101: First-time Adoption of Indian Accounting Standards The Company may opt to apply Ind AS 103 ‘Business Combinations’ prospectively Business from the date of transition. Acquisitions occurred prior to 1.04.2015 may not been Combinations restated. Deemed The Company may elect to measure all

  19. Slide 19: Ind AS 102: Share-based Payment

    Ind AS 102: Share-based Payment IGAAP Ind AS The Company will account for equity settled stock options using the ‘fair value’ method. Under this The Company accounted for equity settled stock method, compensation cost for the employees’ options under the ‘intrinsic value’ method and stock options wi

  20. Slide 20: Ind AS 108: Operating Segments

    Ind AS 108: Operating Segments IGAAP Ind AS  RISK AND RETURN APPROACH :  MANAGEMENT APPROACH : Identification based on the Identification of two sets of segments—one manner in which the entity’s 'Chief Operating Decision based on related products and services, Maker' (CODM) reviews the business co

  21. Slide 21: Ind AS 109: Financial Instruments

    Ind AS 109: Financial instruments IGAAP Ind AS  The Company will account for its investments (i.e., treasury bills, government securities and mutual funds) at fair value. The Company currently accounts for current  The investments will be classified as either Fair investments at lower of cost and

  22. Slide 22: Draft Ind AS Opening Balance Sheet (Standalone)

    DRAFT IND AS OPENING BALANCE SHEET (STANDALONE) BASED ON IND AS – COMPLIANT SCHEDULE III TO COMPANIES ACT, 2013 (EXPOSURE DRAFT)

  23. Slide 23: HUL Draft Ind AS Opening B/S as on 1.04.2015 (Unaudited)

    HUL DRAFT IND AS OPENING B/S AS ON 1.04.2015 (UNAUDITED) Rs. crores Reclass Indian Ind AS GAAP Adjustments IND AS Key adjustments 3 HURB (management pension and medical benefits) 1 trust investment being netted against provision for employee benefits -Ind AS 19. Total Equity and Liabilities 1 2 Fair

  24. Slide 24: Draft Ind AS Restated JQ'15 P/L (Standalone)

    DRAFT IND AS RESTATED JQ’15 P/L (STANDALONE) BASED ON IND AS – COMPLIANT SCHEDULE III TO COMPANIES ACT, 2013 (EXPOSURE DRAFT)

  25. Slide 25: HUL Draft Ind AS JQ'15 Restated P/L (Unaudited)

    HUL DRAFT IND AS JQ’15 RESTATED P/L (UNAUDITED) Rs. crores IND AS IGAAP IND AS adjustment 1 2 3 Key adjustments 1 Increase in revenue due to excise duty reclassification to cost of material consumed (Rs. 584.57 cr) – Ind AS 18 Reclassification of a portion of 2 ‘Advertising & Sales Promotion’ expens

  26. Slide 26: Preliminary Impact Summary

    Preliminary Impact Summary IGAAP Ind AS (restated) Change JQ’15 JQ’15 Net Sales 7,973 cr 8,302 cr + 329 cr PBIT 1,431 cr 1,437 cr + 6 cr Net Profit 1,059 cr 1,068 cr + 9 cr PBIT margin (%) 17.95 % 17.31 % - 64 bps Net Profit margin (%) 13.28 % 12.86 % - 42 bps * A&P % Sales 14.46 % 10.80 % - 3.66% I

  27. Slide 27: Thank You

    THANK YOU a

Hindustan Unilever — Investor Presentation (December 2015) on 6ix