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25 Fair value measurement and disclosures

25.1 Fair value hierarchy

To increase consistency and comparability in fair value measurements and related disclosures, IFRS 13 established a fair value hierarchy that categorizes into three levels the inputs to valuation techniques used to measure their value.

 

Level 1 inputs: Quoted prices (unadjusted) in active markets for identical assets and liabilities that the Group can access at the measurement date.

Level 2 inputs: Inputs other than quoted prices included within level 1 that are observable for the asset or indirectly.

Level 3 inputs: Unobservable inputs for the asset or liability.

 

There have been no transfers between the levels in 2016 and 2017.

 

25.2 Assets and liabilities measured at fair value on a recurring basis after initial recognition

The following table shows the valuation techniques used in the determination of fair values for assets and liabilities measured at fair value on a recurring basis after initial recognition:

 

Position

Net carrying amount in balance sheet measured at fair value

(CHF 1,000)

 Level

Data source

Model

Change in fair value recognized in position

 

2016 

2017 

 

 

 

 

Currency forwards

 (3,748) 

 (109) 

 Level 2

Bloomberg 

(forward rate – [spot rate +/- forward points]) * amount in foreign currency

Financial result 

Currency options

p.m. 

 – 

 Level 2

Bloomberg 

Black-Scholes model

Financial result 

Contingent consideration

 (9,273) 

 (11,639) 

 Level 3

n/a

See note 3.2

Other operating result 

Contingent considerations – level 3 inputs: Beside of the WACCs that were used for discounting the expected payments, the underlying business plans are the most significant unobservable inputs. A decrease in the forecasted net sales of 10% would result in a fair value of 7.1 million considering the sales-defined milestones.

 

25.3 Assets and liabilities measured at fair value on a non-recurring basis after initial recognition (IFRS 5)

Position

Net carrying amount in balance sheet measured according to IFRS 5 (CHF 1’000)

Fair value less costs to sell
(CHF 1’000)

 Level

Data source

Model

Impairment recognized in position

 

2016 

2017 

2016 

2017 

 

 

 

 

Land and buildiungs in 
Hombrechtikon (held for sale)

4'140 

3'650 

n.a. 

3'650 

 Level 3 

n/a 

Net rental method See note 3.3

Other operating result 

Land and buildings Hombrechtikon – level 3 inputs: Beside of the discount rate, the expected future rental income is the most significant unobservable input. It is based on the highest and best use of the property that differs from the current use due to its change in purpose.

 

25.4 Fair value disclosures of financial instruments measured at amortized cost

The carrying amount of financial instruments measured at amortized costs (see note 24.2) is a reasonable approximation of their fair value due to their short-term nature. Bank loans are the only exception due to their long-term nature. Their fair values are disclosed in the following table:

 

Position

Net carrying amount in balance sheet measured at amortized cost
(CHF 1’000)

Fair value disclosure 
(CHF 1’000)

 Level

Data source

Model

 

2016 

2017 

2016 

2017 

 

 

 

Bank loans

 (1'660) 

 (1'229) 

 (1'644) 

 (1'235) 

 Level 2 

Bloomberg 

The fair value is estimated by dis­counting the future contractual cash flows at the current market interest rate that is available to the Group for similar financial instruments.

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