- Post-balance sheet events
No events that are required to be disclosed occurred in the period between the end of the year under review and the preparation of these financial statements.
- Appropriation of profit
Appropriation of profit pursuant to the articles of association
Article 34 of the Articles of Association link states the most important provisions pertaining to the appropriation of profit:
Every year the Management Board, subject to approval from the Supervisory Board, determines the proportion of the company’s profit – the positive balance of the profit and loss account – to be added to the company’s reserves.
The profit remaining after the reservation pursuant to the previous paragraph shall be placed at the disposal of the Annual General Meeting of Shareholders.
Appropriation of profit
Profit for the year
Addition of reserves1
Available for payment
- 1 On the basis of the balance of outstanding and repurchased shares as at 31 December 2014.
The proposal for the appropriation of profit has not been taken into the balance sheet.
- Independent auditor's report
To: the shareholders and Supervisory Board of Beter Bed Holding N.V.
Report on the audit of the financial statements 2014
We have audited the financial statements 2014 of Beter Bed Holding N.V., based in Uden. The financial statements include the consolidated financial statements and the company financial statements.
In our opinion:
- The consolidated financial statements give a true and fair view of the financial position of Beter Bed Holding N.V. as at 31 December 2014, and of its result and its cash flows for 2014 in accordance with International Financial Reporting Standards as adopted by the European Union (EU-IFRS) and with Part 9, Book 2 of the Dutch Civil Code.
- The company financial statements give a true and fair view of the financial position of Beter Bed Holding N.V. as at 31 December 2014, and of its result for 2014 in accordance with Part 9, Book 2 of the Dutch Civil Code.
The consolidated financial statements comprise:
- the consolidated balance sheet as at 31 December 2014;
- the following statements for 2014: consolidated profit and loss account, consolidated statement of comprehensive income, consolidated cash flow statement and the consolidated statement of changes in equity;
- the notes comprising a summary of the significant accounting policies and other explanatory information.
The company financial statements comprise:
- the company balance sheet as at 31 December 2014;
- the company profit and loss account for 2014;
- the notes comprising a summary of the significant accounting policies and other explanatory information.
Basis for our opinion
We conducted our audit in accordance with Dutch law, including the Dutch Standards on Auditing. Our responsibilities under those standards are further described in the “Our responsibilities for the audit of the financial statements” section of our report.
We are independent of Beter Bed Holding N.V. in accordance with the Regulation on the independence of auditors in assurance engagements (the Dutch ViO) and other relevant independence regulations in the Netherlands. Furthermore, we have complied with the Accountants Code of Conduct Regulation (the Dutch VGBA).
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. The materiality affects the nature, timing and extent of our audit procedures and the evaluation of the effect of identified misstatements on our opinion.
Based on our professional judgment we determined the materiality for the financial statements as a whole at € 2,500,000. The materiality is based on approximately 0.75% of the 2014 revenue, which we consider to be the most relevant and relatively stable base to determine the materiality. We have also taken into account misstatements and/or possible misstatements that in our opinion are material for the users of the financial statements for qualitative reasons.
The materiality for the financial statements as a whole is allocated to the audit of the group entities based on the relative size of the individual entity.
We agreed with the Supervisory Board that misstatements in excess of €125,000, which are identified during the audit, would be reported to them, as well as smaller misstatements that in our view are relevant on qualitative grounds.
Scope of the group audit
Beter Bed Holding N.V. is head of a group of entities. The financial information of this group is included in the consolidated financial statements of Beter Bed Holding N.V.
Because we are ultimately responsible for the opinion, we are also responsible for directing, supervising and performing the group audit. In this respect we have determined the nature and extent of the audit procedures to be carried out for group entities. Decisive were the size and/or the risk profile of the group entities or operations. On this basis, we selected group entities for which an audit or review had to be carried out on the complete set of financial information or specific items.
Our group audit mainly focused on significant group entities such as the Beter Bed and Beddenreus formulas in the Netherlands, Matratzen Concord in Germany and the holding entity also based in the Netherlands. For Beter Beheer in the Netherlands we performed specific audit procedures on tangible fixed assets and cash and cash equivalents, since these items represent a significant proportion of the total. We performed the audit procedures on the Dutch entities ourselves. We used the work of other EY auditors when auditing the German entity. The audit procedures on the significant entities represent 86% of the consolidated revenue.
By performing the procedures mentioned above at group entities, together with additional procedures at group level, we have obtained sufficient and appropriate audit evidence with respect to the group’s financial information to issue an opinion on the consolidated financial statements.
Our key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements. We have communicated the key audit matters to the supervisory board. The key audit matters are not a comprehensive reflection of all matters discussed.
These matters were addressed in the context of our audit of the financial statements as a whole and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
The revenues of Beter Bed Holding N.V. as included in the financial statements under the general accounting principles and specifically in disclosure note 12 are based on the delivery of goods and services to third parties less discounts. A part of the revenue is recognised directly in the stores upon direct receipt of the goods by the customer. The remaining part of the revenue is realised upon delivery at the customer’s home. The main risks identified for the financial statements are related to the proper allocation of revenue to the correct financial year and the realisation of correct and complete margins.
We have designed our audit procedures to obtain certainty with respect to this revenue recognition. Our audit approach contains both internal control testing procedures and a number of substantive audit procedures. For a number of entities we applied data analysis as well. An important part of our audit concerned the correct allocation of revenues between the financial years and we have focused on the margin analyses which were performed with a high level of detail.
Closure of Slaapgenoten and Matrassen Concord in the Netherlands and Belgium
As included in disclosure note ‘Provisions’ in the financial statements, Beter Bed Holding N.V. has simplified its formula portfolio in the Benelux countries. The operations of the formulas Matrassen Concord in the Netherlands and Belgium and Slaapgenoten were completely terminated in the course of 2014. The 2013 financial statements already stated a provision for rental obligations. The provision is subject to subjective estimates, and takes account of subletting.
During our audit we focused on the run-off of the provision during the year. Furthermore, we assessed management’s current estimates for the remaining part of the provision and concluded that account has again been taken of subletting.
Responsibilities of management and the Supervisory Board for the financial statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with EU-IFRS and Part 9, Book 2 of the Dutch Civil Code, and for the preparation of the annual report in accordance with Part 9, Book 2 of the Dutch Civil Code. Furthermore, management is responsible for such internal control as management determines is necessary to enable the preparation of the financial statements that are free from material misstatement, whether due to fraud or error.
As part of the preparation of the financial statements, management is responsible for assessing the company’s ability to continue as a going concern. Based on the financial reporting frameworks mentioned, management should prepare the financial statements on the basis of the going concern assumption unless management either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so. Management must disclose events and circumstances that could cast reasonable doubt on the company’s ability to continue as a going concern in the financial statements.
The Supervisory Board is responsible for overseeing the company’s financial reporting process.
Our responsibilities for the audit of the financial statements
Our objective is to plan and perform the audit assignment in a manner that allows us to obtain sufficient and appropriate audit evidence for our opinion.
Our audit has been performed with a high, but not absolute, level of certainty, which means we may not have detected all errors and fraud during our audit.
We have exercised professional judgment and have maintained professional scepticism throughout the audit, in accordance with Dutch Standards on Auditing, ethical requirements and independence requirements. Our audit included:
- identifying and assessing the risks of material misstatement in the financial statements, whether due to fraud or error, designing and performing audit procedures responsive to those risks, and obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;
- obtaining an understanding of the internal controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal controls;
- evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management;
- establishing that management’s use of the going concern assumption is acceptable, and based on the audit evidence obtained, whether there are events or circumstances that could lead to reasonable doubt as to the company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or circumstances may lead to the company no longer being able to continue as a going concern;
- evaluating the overall presentation, structure and content of the financial statements, including the disclosures;
- evaluating whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with the Supervisory Board regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant findings in internal controls that we identify during our audit.
We provide the Supervisory Board with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the Supervisory Board, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or if, in extremely rare circumstances, communicating the matter would not be in the public interest.
Report on other legal and regulatory requirements
Report on the annual report and the other data
Pursuant to legal requirements of Part 9, Book 2 of the Dutch Civil Code (concerning our obligation to report about the annual report and the other data):
- We have no deficiencies to report as a result of our examination whether the annual report, to the extent we can assess, has been prepared in accordance with Part 9, Book 2 of the Dutch Civil Code, and whether the information as required by Part 9, Book 2 of the Dutch Civil Code has been included.
- We report that the annual report, to the extent we can assess, is consistent with the financial statements.
We were appointed as the auditor of Beter Bed Holding N.V. by the Supervisory Board with effect from the audit for year 1996, and have acted as external auditor since that date.
Eindhoven, The Netherlands, 12 March 2015
Ernst & Young Accountants LLP
signed W.J. Spijker