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ENAV Group Consolidated Financial Statements

Provisions for risks and charges

Provisions for risks and charges are recognized for losses and charges of a specific
nature whose existence is certain or probable, but where the amount and/or date of
occurrence cannot be determined. Provisions are only recognized when the company
has a present obligation, legal or constructive, arising from a past event, when it
is probable that a future outflow resources representing benefits will be required
to settle the obligation and when it is possible to make a reliable estimate of that
amount.
Where the financial effect of the time value of money is material and the dates
of settling the obligations can be reliably estimated, the provisions are discounted
using a pre-tax rate that reflects, where suitable, the market’s current assessment
of the time value of money and, if applicable, the risks specific to the liability. The
increase in the carrying amount of a provision as the result of the passage of time is
recognized as a financial expense.
Changes in the estimates of accruals to provisions are recognized in profit or loss in
the period in which the change occurs and as an increase in the liability. A decrease
in estimates is recognized by making a counter-entry to the liability up to its carrying
amount, while any excess is recognized in profit or loss in the line item to which the
provisions refer.
Amounts included in provisions for risks and charges are classified as either current
or non-current depending on the estimated date on which the liability will be settled
or extinguished.
Risks where it is only possible that a liability will arise are shown in the appropriate
disclosure section on contingent liabilities, and no provision is made for these.

Grants

Revenue grants are recognized on an accrual basis in the year in which the reasonable
assurance arises that the Company is entitled to receive them, regardless of the date
of receipt.
Capital grants are recorded when a formal allocation resolution exists from the
provider, and if, and only if, there is reasonable certainty that the project being
facilitated will effectively be completed and that the contributions will be received,
based on the information available at the close of the financial period. Capital grants
are recognised and differed as current and non-current liabilities, according to the
expected reversal timing, and charged to the Income Statement as income on a
straight-line basis, calculated according to the useful life of the underlying asset
to which the grant refers to directly, thus ensuring there is a correlation with the
amortisations relating to the assets.

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