The consolidated financial statements were prepared in accordance with the statutory provisions of DCC Title 9, Book 2 and the Dutch Guidelines for Annual Reporting (Richtlijnen voor de Jaarverslaggeving, RJ). This is based on the going-concern assumption. 

Profit is measured and determined using historical costs unless stated otherwise. Income and expenses are allocated to the year to which they relate. Gains are only recognised if they were realised at the balance sheet date, unless stated otherwise. Liabilities and potential losses arising before the end of the reporting year are accounted for it they become apparent before the financial statements are prepared. 

The accounting policies applied have remained unchanged since the previous year.

The items in the financial statements of the group companies are measured using the currency of the economic environment in which the group companies carry out the majority of their business activities (functional currency). The euro is the functional currency and the presentation currency of DELA Group. 

Transactions in foreign currencies during the reporting period are recognised in the financial statements at the exchange rate on the transaction date. Assets and liabilities in foreign currencies that are stated at fair value are translated at the exchange rate as at the balance sheet date. Exchange rate differences that arise in the settlement of monetary items are recognised in the income statement in the period in which they occur. 

Assets measured at historical cost in a foreign currency are translated using the exchange rate prevailing on the transaction date (or approximate exchange rate).

Reinsurance is utilised for our term-life insurance through a combination of quota share and excess of loss reinsurance contracts. The aim is to limit the chance of fluctuations in the operating profit. DELA Natura is compensated for losses on issued insurance contracts by contracts made with reinsurers. 

Reinsurance premiums, commissions and claims as well as technical provisions for reinsurance contracts are accounted for in the same way as the direct insurance for which the reinsurance was taken out. The reinsurers' share of the technical provisions to which DELA Natura is entitled under its reinsurance contracts is deducted from the gross technical provisions. Amounts owed by reinsurers falling due within one year are entered under receivables. 

Amounts due from or payable to reinsurers are measured in accordance with the conditions of the reinsurance contracts. Reinsurance liabilities primarily concern premiums payable. 

Receivables arising out of reinsurance contracts are tested at the balance sheet date for any impairment.

Intangible fixed assets are measured at historical cost less accumulated amortisation and any impairment losses. Amortisation is taken on a straight-line basis over the useful life of the assets. Their useful life is reassessed at the end of the financial year, and the amortisation period is revised if any significant changes are detected. A statutory reserve is recognised for the costs of internal development, equivalent to the value of the capitalised amount. 

See section 2.7 to determine whether an intangible fixed asset has become impaired.

Goodwill paid on acquisitions is measured at fair value on acquisition. Fair value is the amount that would have to be paid between knowledgeable, willing parties in an arm's length transaction. Goodwill is amortised on a straight-line basis over its expected useful life, which is assessed annually. The current expected useful life of various goodwill positions is between 20 and 30 years. 

The future cash flows from acquired insurance portfolios are measured at their fair value at the time of acquisition. Fair value is the amount that would have to be paid between knowledgeable, willing parties in an arm's length transaction. This value is amortised on a straight-line basis over its expected useful life, which is assessed annually. The current expected useful life for acquired insurance portfolios is 20 years, calculated from the acquisition date.

Software development expenses are capitalised as part of the production cost if it is probable that there will be future economic benefits and the costs can be reliably measured. Investments in software systems are capitalised and amortised on a straight-line basis over their expected useful life, with a maximum of 10 years. 

The accounting policy per investment category is described below. The majority of the investments are measured at fair value. Section 5 in the notes to the balance sheet item provides a more detailed explanation of fair value, if required. Both unrealised and realised gains and losses due to the sale and changes in the value of investments are recognised in the income statement. Transaction costs related to the purchase and sale of investments are recognised directly in the income statement under the administration expenses, except for the purchase costs of mortgage loans. The purchase and sale of securities is recognised on the transaction date.

Real estate is measured at its fair value at the balance sheet date. Changes in the value of investments in real estate are recognised in the income statement. If these accumulated changes are positive, a revaluation reserve is formed and charged to the free reserves, taking into account deferred taxes. Section 5.3 provides more detailed information on the valuation method.

Participating interests over which significant influence can be exercised are measured using the equity method (net asset value method). In the event that 20 per cent or more of the voting rights can be exercised, it may, by law, be assumed that there is significant influence.

The net asset value is calculated in accordance with the accounting policies that apply to these financial statements; for participating interests about which there is not enough information available for alignment with these policies, the accounting policies of the relevant participating interest prevail. 

If the measurement of a participating interest based on net asset value is negative, it will be stated at nil. If and in so far as DELA Group can be held fully or partially liable for the debts of the participating interest, a provision is recognised for this. Participating interests are recognised initially at the fair value of the identifiable assets and liabilities on acquisition and subsequently on the basis of the accounting policies used for these financial statements using this initial value as a basis. 

Participating interests where no significant influence can be exercised are measured at historical cost. In the event of permanent impairment, the item is carried at the recoverable amount. Impairment losses are charged to the income statement.

Amounts owed by participating interests recognised under financial fixed assets are measured at the fair value of the amount provided, which is normally its nominal value, less any provisions deemed necessary.

Shares are measured at fair value based on official listings in the financial markets. Changes in value are recognised directly in the income statement.

Bonds are measured at fair value based on official listings in the financial markets.

DELA Group has forward exchange contracts that are measured at fair value. The gain or loss from the revaluation into fair value at the balance sheet date is immediately recognised in the income statement. This concerns unquoted assets, which are measured using financial models: the mark-to-model method. Any derivative financial instruments with a negative value are categorised in the balance sheet under accruals and deferred income.

Mortgage loan receivables are measured at amortised cost. The direct costs related to the provision of a mortgage loan are included as purchase costs. They are part of the amortised cost and are capitalised in the balance sheet. An assessment will be made at the balance sheet date as to whether there is any objective evidence that the mortgage loan receivables are impaired. The loss is recognised in the income statement if this proves to be the case.

Investments in business loans are measured at fair value.
Other loans have a fixed interest rate and are measured at amortised cost less a provision for doubtful debts.

Investments in real estate funds, infrastructure funds, and agricultural and forestry funds are measured at fair value. This item contains investments without a frequent quotation. Section 5.3 provides more detailed information on the valuation method. Changes in value are recognised directly in the income statement. A revaluation reserve is recognised for the accumulated unrealised positive value.

Investments in mortgage funds are measured at fair value. This item contains investments without a frequent quotation. Section 5.3 provides more detailed information on the valuation method. Changes in value are recognised directly in the income statement. A revaluation reserve is recognised at fund level for the accumulated unrealised positive value.

Investments in cash and cash equivalents are measured at fair value, which is the same as their nominal value.

Other financial investments are measured at fair value. This item contains investments without a frequent quotation. Section 5.3 provides more detailed information on the valuation method. Changes in value are recognised directly in the income statement. A revaluation reserve is recognised for the accumulated unrealised positive value. An exception is the art collection, which is carried at historical cost.

Receivables are measured at fair value on initial recognition and subsequently measured at amortised cost. Any provisions deemed necessary for possible losses due to doubtful debts are deducted. These provisions are determined based on an individual assessment of the amounts receivable.

Deferred tax assets are recognised for all temporary differences between the value of the assets and liabilities under tax regulations and the accounting policies used in these financial statements. In addition, a deferred tax asset has been recognised for tax losses carried forward. Deferred tax assets are recognised if it is deemed probable that sufficient future taxable profit will be available. The calculation of deferred tax assets at nominal value is based on the tax rates prevailing at the end of the reporting year or the rates applicable in future years, to the extent that they have already been enacted by law.

DELA Group assesses at the balance sheet date whether there are any indications that a fixed asset may be impaired. If so, the recoverable amount of the individual asset is determined. If the recoverable amount of an individual asset cannot be determined, the recoverable amount of the cash-generating unit to which the asset belongs is determined. This involves the use of estimates. An asset is impaired if its carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's net selling price and its value in use.

If it is determined that a previously recognised impairment loss no longer exists or has decreased, the impairment loss is reversed up to the carrying amount that would have been determined if no impairment loss had been recognised for the asset.

For financial instruments, DELA Group also assesses at each balance sheet date whether there are objective indications of impairments of a financial asset or group of financial assets. In the event of such indications, the impairment loss is determined and recognised directly in the income statement.

For financial assets that were measured at amortised cost, the amount of the impairment loss is determined as the difference between the asset's carrying amount and the best estimate of the future cash flows, discounted at the effective interest rate of the financial asset as determined on the initial recognition of the instrument. Any reversal of an impairment loss is limited to the amount required to measure the asset at amortised cost. The reversed loss is then recognised in the income statement. Any impairment of goodwill will not be reversed in the future.

The minority interests in the group equity concern the minority holdings by third parties in the equity of the consolidated companies. The minority interests in the profit of the consolidated companies are deducted from the group profit in the income statement.

If the losses attributable to a minority interest exceed the minority interest in the equity of the consolidated companies, the difference and any further losses are charged in full to DELA Group unless and in so far as the minority shareholder has the obligation and is able to cover these losses. If the consolidated companies return to profitability, their profit will be transferred to DELA Group until any loss covered by DELA Group has been fully recouped.

Determining the technical provisions is a process that by its very nature involves uncertainties. The actual claims depend on factors such as social, economic and demographic trends, inflation, investment returns, the behaviour of policyholders and assumptions about changes in mortality. Any use of different assumptions for these factors than the actuarial policies used to determine rates currently applied in the financial statements could have a material effect on the technical provisions and underwriting expenses (see also 5.11: liability adequacy test).

For claims under insurance policies that are expected to be paid in the future, a liability is recognised as soon as the policy takes effect. The funeral insurance liabilities for our own account and risk consist of the discounted (at actuarial interest) value of the expected (based on actuarial mortality) future claims (including recognised profit share) payable to policyholders or other beneficiaries, less future premiums.

The technical provision for DELA UitvaartPlan is calculated in accordance with the pure net method at an interest rate of 2.75 per cent and based on the GBM/V 1995-2000 mortality table published by the Dutch Actuarial Association (Actuarieel Genootschap), using the mortality and interest bases. For insurance policies with temporary premium payments, the actuarial interest rate for the period after the end date for the payment of premiums is 2 per cent.

The technical provisions for the Yarden portfolio acquired in 2021 are based on accounting policies used for measurement at fair value on the acquisition date. The actuarial interest rate is 1.3 per cent on average, and the mortality rate is based on the 2020 life expectancy table published by the Dutch Actuarial Association. Lapses and surrenders were also taken into account at the time of acquisition based on historical figures and the current cost level. In addition, there is an additional provision regarding the Yarden portfolio: At the time of the acquisition, DELA guaranteed that bereaved families will not have to pay inflation deficits for the first ten years after the acquisition. These deficits are estimated at the time of acquisition and discounted, resulting in the fair value of this commitment.

Most of the technical provision for funeral insurance for our own account and risk as taken out in Belgium is calculated in accordance with the pure net method based on the usual interest rates and life expectancy tables at the time that the policies took effect and using the mortality and interest rate bases. The expected claims are based on the actuarial rate policies as determined when taking out the policy.

The technical provision for DELA Sorgenfrei Leben is calculated using the pure net method at an interest rate of 2 per cent. The mortality rates are based on mortality tables published by the German Association of Actuaries (Deutsche Aktuarvereinigung, DAV).

The technical provisions in the insurance portfolio acquired in Germany in 2022 are based on accounting policies used for measurement at fair value on the acquisition date. The actuarial interest rate is 2.5 per cent on average, and the mortality rate is based on the 2022 life expectancy table published by the Dutch Actuarial Association.

The technical provision for the DELA LeefdoorPlan (life insurance plan) is calculated in accordance with the pure net method at an interest rate of 3 per cent and based on the life expectancy tables published by the Dutch Actuarial Association when the actuarial rate was introduced.

The technical provision for DELA Activ Leben is calculated in accordance with the pure net method at an interest rate of 3 per cent. The mortality rates are based on mortality tables published by the German Association of Actuaries.

The technical provision for the DELA CoöperatiespaarPlan (savings plan) is calculated in accordance with the built-up surrender value based on the savings premiums paid, the recognised profit shares and the interest rate associated with the actuarial rate.

Whether and how a share of the profit is granted under the terms of the DELA Uitvaartplan is determined by the general meeting of Coöperatie DELA on the recommendation of the Executive Board. The balance between healthy solvency, sufficient equity levels, and profit sharing is important in this decision for the financial health of our cooperative. The amount of the profit share is calculated on an actuarial basis. The amount of the annual profit share is determined by the Executive Board itself within the principles agreed with the general meeting. If a different profit share is proposed, it must be approved by the general meeting on the recommendation of the Executive Board. The profit share, if any, is then recognised via the technical provisions. The addition of the amount that Coöperatie DELA has appropriated for profit sharing in respect of the technical provisions is charged to the profit.

Provisions are recognised for legally enforceable or constructive obligations that exist at the balance sheet date and for which it is probable that an outflow of resources will be required, and a reliable estimate can be made.

Provisions are measured at the best estimate of the amount that is necessary to settle the obligations as at the balance sheet date. Provisions are measured at the present value of the expenditure expected to be needed to settle the obligations, unless stated otherwise.

 If obligations are expected to be reimbursed by a third party, such reimbursement is recognised as an asset in the balance sheet if it is probable that such reimbursement will be received when the obligation is settled.

The provision for anniversaries is included for expected long-service awards during the course of employment (25 years and 40 years of service) and for when employees reach retirement age. The probability of future employee outflow is taken into account when determining the provision. This is based on historical figures. The impact of wage inflation and discounting is not taken into account in the expected awards as this is immaterial on balance.

For any tax amounts to be paid in the future resulting from differences between commercial and tax balance sheet valuations, a provision is recognised for the amount of these differences multiplied by the applicable tax rate. This provision is then reduced by the yet to be settled tax amounts resulting from tax losses carried forward to the extent that it is probable that taxable profit will be available against which the difference can be utilised. The provision for deferred tax liabilities is measured at nominal value.

The calculation of deferred tax liabilities is based on the tax rates prevailing at the end of the reporting year or the rates applicable in future years, to the extent that they have already been enacted by law.

The provision concerns the expected costs for maintaining and replacing parts of installations in crematoriums. These are recognised on the basis of current contracts as at the balance sheet date arising from the provision of goods and services, spread across several years. Costs incurred as well as future maintenance funds per cremation are charged to the provision.

If the effect of the time value of money is material, the other provisions will be measured at the present value of the expenditure expected to be needed to settle the relevant liabilities. Discounting is based on a discount rate before taxes that reflects both the current market interest rate and the specific risks related to the liability.

If the effect of the time value of money is not material, the other provisions are measured at nominal value. The other provisions are measured at present value unless stated otherwise.

Non-current liabilities fall due in more than one year and are measured at fair value on initial recognition, which at that time is the same as amortised cost. Directly attributable transaction costs are included in the measurement on initial recognition. Non-current liabilities are subsequently measured at amortised cost, which is the amount received, taking into account the premium or discount and less transaction costs. If there is no premium or discount, this amount is the same as their nominal value.

The difference between the carrying amount and the ultimate redemption value is charged to the income statement as interest expense over the estimated term of the liability based on the effective interest rate.

Although current liabilities fall due within one year, they are measured in the same way as non-current liabilities.

Accruals and deferred income are measured at fair value on initial recognition and subsequently measured at amortised cost.

DELA Group has lease contracts where most of the advantages and disadvantages of the property do not lie with the organisation. These lease contracts are recognised as operating leasing. Operating leasing liabilities are recognised in the income statement on a straight-line basis over the term of the contract, taking account of payments received by the lessor.

The gross premiums consist of the premiums that are payable by policyholders for insurance contracts. The gross premiums excluding taxes and other fees resulting from insurance contracts are recognised as income when they are due by the policyholder. For single premium contracts the premium is recognised as income when it is due, with any cost and risk coverages being postponed and recognised in the result at a constant proportion to the ongoing insurance.

The reinsurance premiums comprise the premiums for reinsurance contracts. They are recognised in the income statement as an expense.

This comprises the following: 

• rental income from investments in real estate; 
• results of participating interests; 
• dividends from shares; 
• interest on investments in fixed-income securities;
• realised gains and losses on the sale of investments;
• unrealised result originating from changes in the value of securities and real estate.

The revenue from the funeral business is recognised when the services are provided.

Other revenue includes the proceeds from the sale, installation, and maintenance of cremators.

Revenue from the sale of cremators and related goods is recognised when all the significant risks and rewards of ownership of the goods have been transferred to the buyer. Revenue from the provision of services is recognised in proportion to the services provided up to the balance sheet date relative to the total services to be provided. For cremators in course of construction where the profit can be reliably estimated, the revenue and costs are recognised using the percentage-of-completion method. If the profit cannot be reliably measured, revenue is only recognised to the extent that the costs incurred are likely to be recovered.

Finally, revenue other than that from the operating activities of DELA Group is also recognised as other revenue.

Net revenue comprises the income from the provision of goods and services less discounts and such, VAT, and after the elimination of transactions within DELA Group. One of these eliminations pertains to payments by the insurer used for funerals at the funeral services provider.

Acquisition costs are costs directly related to taking out insurance policies, which depend on and relate to the acquisition of new insurance contracts or the extension of existing ones. Acquisition costs consist of commissions paid to third parties for insurance products. The acquisition costs are deducted from the technical provision and expensed over ten years. The annual commissions are offset by the commissions recovered throughout the year. The amortisation period is regularly assessed. Where applicable, the amortisation charges are adapted to the shorter amortisation period.

The liability adequacy test is an annual assessment of whether the technical provision less the deferred acquisition costs and VOBA (Value of Business Acquired) is sufficient to provide a high degree of certainty regarding future amounts payable to policyholders. If this test leads to the conclusion that there is inadequate liquidity, the deferred acquisition costs are initially expensed in so far as necessary.

Wages, salaries, and social security contributions are recognised in the income statement when they are due for payment to employees and the tax authorities. The pension schemes are described in the following sections.

These are items that result from ordinary activities but which are not accounted for as part of the operating profit due to their nature, size, or that are non-recurring. The aim is to facilitate the analysis and comparability of the operating profit over the years.

Intangible and tangible fixed assets are amortised/depreciated over the expected future useful life of the asset from the time it is put into use. Land is not depreciated. Future amortisation/depreciation is adjusted accordingly if there is a change in the asset's useful life. Gains and losses recognised on the occasional sale of tangible fixed assets are included in the exceptional income and expenses.

The tax on profit is calculated on the profit before tax in the income statement, taking into account any tax losses carried forward (in so far as they are not included in the deferred tax assets) and exempt profit components, and after adding non-deductible expenses. Future changes to the applicable tax rate are also taken into account.

Management regularly assesses the positions taken in the tax returns in situations where tax law allows room for interpretation and makes provisions where necessary for amounts that it expects will need to be paid to the local tax authorities.

In relation to the legislation on Pillar 2 income taxes, DELA Group has exercised the mandatory exception based on RJ statement 2023-14 regarding the treatment of deferred tax assets and liabilities related to Pillar 2 income taxes.