Gschäftsbericht 2018

Galenica financial statements 2018 | 119 Finance Notes to the consolidated financial statements of the Galenica Group 24.2 Fair value measurement Accounting principles Fair value Non-current financial liabilities contain contingent consideration liabilities from business combinations which are mea­ sured at fair value. The fair value of these financial instruments is measured based on the expected cash flows in due consideration of the probability of occurrence and the current market interest rates (level 3 of the fair value hierarchy). The fair values of the fixed-rate bonds derived from quoted prices (level 1 of the fair value hierarchy) or calculated based on the expected cash flows, the current market interest rates and the counterparties’ credit risk (level 3 of the fair value hierarchy). Fair value hierarchy Galenica measures financial instruments at fair value using the following hierarchies for determining the fair value: – Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities. – Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices). – Level 3: Unobservable inputs for the asset or liability. These inputs reflect the best estimates of Galenica based on criteria that market participants would use to determine prices for assets or liabilities at the reporting date. Fair value in thousand CHF Carrying amount 2018 Fair value Carrying amount 2017 Fair value Non-current financial liabilities 272 272 1,034 1,034 Bonds 380,638 381,620 380,747 384,650 Non-current financial liabilities 380,910 381,892 381,781 385,684 With the exception of non-current financial liabilities the carrying amounts of all financial instruments approximate to the fair value. Fair value of contingent consideration liabilities from business combinations (level 3 of the fair value hierarchy) in thousand CHF 2018 2017 1 January 150 3,500 Change in fair value (recognised in profit or loss) — (1,550) Payments (cash out) (150) (1,800) 31 December — 150