Strategic report Governance Financial statements Other information SECTION 5: OTHER NOTES NOTES TO THE GROUP FINANCIAL STATEMENTS OTHER 5.1 General information Hargreaves Lansdown plc (the “Company” and ultimate parent of the Group) is a company incorporated Business combinations in England and Wales with company number 02122142 and domiciled in the United Kingdom under the The acquisition of subsidiaries is accounted for using the purchase method. The cost of the acquisition Companies Act 2006 whose shares are publicly traded on the London Stock Exchange. The address of is measured at the aggregate of the fair values, at the date of exchange, of assets given, liabilities the registered office is One College Square South, Anchor Road, Bristol BS1 5HL, United Kingdom. The incurred or assumed, and equity instruments issued by the Group in exchange for control of the nature of the Group’s operations and its principal activities are set out in the Operating and Financial acquired entity. The acquired entity’s identifiable assets, liabilities and contingent liabilities that meet Review as part of the Strategic report. the conditions for recognition under IFRS 3 ‘Business Combinations’ are recognised at their fair value These financial statements are presented in millions of pounds sterling (£m) which is the currency of at the acquisition date. the primary economic environment in which the Group operates. The Group recognises any non-controlling interest in the acquired entity at the non-controlling Basis of preparation interest’s proportionate share of the recognised amounts of acquired entity’s identifiable net assets. These financial statements have been prepared in accordance with international accounting Application of new standards standards in conformity with the requirements of the Companies Act 2006 (‘IFRS’) and the applicable In the current year, the following new and revised standards and interpretations have been adopted legal requirements of the Companies Act 2006. In addition to complying with international accounting but do not materially affect amounts reported or the accounting policies in these financial statements: standards in conformity with the requirements of the Companies Act 2006, the consolidated financial Changes in accounting policy statements also comply with international financial reporting standards adopted pursuant to The following standards have been adopted in the current year, but do not have a material impact on Regulation (EC) No 1606/2002 as it applies in the European Union. The financial statements are these financial statements. prepared on a going concern basis as discussed on page 129. The financial statements are presented to allow users to understand the primary statements and the • Amendments to References to the Conceptual Framework in IFRS Standards; related balances that make them up. It is our aim to ensure that the information provided is pertinent • Amendments to IFRS 3 – ‘Definition of a Business’; and indicates balances of most importance, while ensuring conformity with IFRS. In order to do this, we Amendments to IAS 1 and IAS 8 – ‘Definition of material’: have aligned the notes to the financial statements with the relevant primary statements; where there • is an associated accounting policy, it is denoted by a box presented at the beginning of the note. • IFRIC update to IAS 38 – ‘Configuration or Customisation Costs in a Cloud Computing Arrangement’ The preparation of financial statements in conformity with IFRS requires the use of certain significant At the date of authorisation of these financial statements, the Group has not applied the following new accounting estimates. It also requires management to exercise its judgement in the process of and revised IFRS Standards that have been issued but are not yet effective: applying the Company’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, • IFRS 17 – ‘Insurance Contracts’; if any, are disclosed in note 5.2. • IFRS 10 and IAS 28 (amendments) – ‘Sale or Contribution of Assets between an Investor and its Basis of consolidation Associate or Joint Venture’; The consolidated financial statements incorporate the financial statements of the Company and • Amendments to IAS 1 – ‘Classification of Liabilities as Current or Non-current’; subsidiary undertakings controlled by the Group made up to 30 June 2021. The Group controls a subsidiary when it has power over an investee, is exposed, or has rights, to variable returns from its • Amendments to IFRS 3 Reference to the Conceptual Framework; involvement with the subsidiary and has the ability to affect those returns through its power over Amendments to IAS 16 – “Property, Plant and Equipment – Proceeds before Intended Use’; • the investee. The Group reassesses whether it controls a subsidiary when facts and circumstances indicate that there are changes to one or more elements of control. • Amendments to IAS 37 – ‘Onerous contracts – Cost of Fulfilling a Contract’ The results of subsidiaries acquired or disposed of during the year are included in the consolidated • Annual Improvements to IFRS Standards 2018 – 2020 Cycle (Amendments to IFRS 1 First-time income statement from the effective date of acquisition or up to the effective date of disposal, as Adoption of International Financial Reporting Standards, IFRS 9 Financial Instruments, IFRS 16 appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to Leases, and IAS 41 Agriculture). bring the accounting policies used into line with those used by the Group. All intra-Group transactions, The Directors do not expect that the adoption of the Standards listed above will have a material impact balances, income and expenses are eliminated on consolidation. on the financial statements of the Group in future periods. 163 Hargreaves Lansdown Report and Financial Statements 2021