Investor Presentaiton

135 A.P. Møller-Mærsk A/S Annual Report 2020 Financials Parent company financial statements Notes index Amounts in USD million == Note 19 Significant accounting policies The financial statements for 2020 for A.P. Møller-Mærsk A/S have been prepared on a going concern basis and in accordance with the International Financial Reporting Standards (IFRS) as adopted by the EU and additional Danish disclosure requirements for listed companies. The consolidated financial statements are also in accordance with IFRS as issued by the Inter- national Accounting Standards Board (IASB). The accounting policies of the company are consistent with those applied in the financial statements for 2019, apart from the fact that the company in December 2019 elected to early adopt the amendments to IFRS 9, IAS 39 and IFRS 7 included in IASB's project 'Interest Rate Benchmark Reform'. The accounting policies are furthermore consistent with the accounting policies for the Group's financial state- ments (note 23 in the consolidated financial statements) with the following exceptions: Shares in subsidiaries and associated companies are measured at cost or a lower recoverable amount Dividends from subsidiaries and associated companies are recognised as income at the time of declaration unless considered a return of capital in subsidiary No segment information is disclosed Value of granted share options, restricted shares and performance shares to employees in subsidiaries is expensed directly in the relevant subsidiary. At the time of the grant, the subsidiary settles the amount with A.P. Møller-Mærsk A/S and the counter posting is made in equity. At the time of exercising, the proceeds are included in the company's equity. New financial reporting requirements The company has not yet adopted the following accounting standards/requirements: IFRS 17-Insurance contracts IFRS 17: An analysis of the impact is being assessed and is expected to be concluded in due course ahead of the implementation date. Other changes to IFRS are not expected to have any significant impact on recognition and measurement. Note 20 Significant accounting estimates and judgements When preparing the financial statements of the company, management undertakes a number of accounting esti- mates and judgements to recognise, measure and classify the company's assets and liabilities. Estimates that are material to the company's financial re- porting are made on the basis of, inter alia, determination of impairment of financial non-current assets including subsidiaries and associated companies (including assets held for sale) and recognition and measurements of pro- visions. Reference is made to notes 4, 6 and 11. Management assesses impairment indicators for invest- ments in subsidiaries and associated companies and determines recoverable amount generally consistent with the assumptions described in notes 6, 7 and 24 of the consolidated financial statements. The accounting estimates and judgements are described in further detail in note 24 of the consolidated financial statements.

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