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"unit": "iso4217:NOK"
}
},
"ID_375": {
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"unit": "iso4217:NOK"
}
},
"ID_377": {
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"decimals": -6,
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"unit": "iso4217:NOK"
}
},
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"decimals": -6,
"dimensions": {
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"entity": "scheme:549300IM1QSBY4SLPM26",
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"unit": "iso4217:NOK"
}
},
"ID_379": {
"value": "-632000000",
"decimals": -6,
"dimensions": {
"concept": "ifrs-full:IncreaseDecreaseThroughChangesInOwnershipInterestsInSubsidiariesThatDoNotResultInLossOfControl",
"entity": "scheme:549300IM1QSBY4SLPM26",
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"unit": "iso4217:NOK"
}
},
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"ifrs-full:ComponentsOfEquityAxis": "ifrs-full:IssuedCapitalMember",
"unit": "iso4217:NOK"
}
},
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"ifrs-full:ComponentsOfEquityAxis": "TEL:OtherrreservesMember",
"unit": "iso4217:NOK"
}
},
"ID_354": {
"value": "13015000000",
"decimals": -6,
"dimensions": {
"concept": "ifrs-full:DividendsPaid",
"entity": "scheme:549300IM1QSBY4SLPM26",
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}
},
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"ifrs-full:ComponentsOfEquityAxis": "ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember",
"unit": "iso4217:NOK"
}
},
"ID_356": {
"value": "13015000000",
"decimals": -6,
"dimensions": {
"concept": "ifrs-full:DividendsPaid",
"entity": "scheme:549300IM1QSBY4SLPM26",
"period": "2022-01-01T00:00:00/2023-01-01T00:00:00",
"ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember",
"unit": "iso4217:NOK"
}
},
"ID_357": {
"value": "3159000000",
"decimals": -6,
"dimensions": {
"concept": "ifrs-full:DividendsPaid",
"entity": "scheme:549300IM1QSBY4SLPM26",
"period": "2022-01-01T00:00:00/2023-01-01T00:00:00",
"ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember",
"unit": "iso4217:NOK"
}
},
"ID_358": {
"value": "16174000000",
"decimals": -6,
"dimensions": {
"concept": "ifrs-full:DividendsPaid",
"entity": "scheme:549300IM1QSBY4SLPM26",
"period": "2022-01-01T00:00:00/2023-01-01T00:00:00",
"unit": "iso4217:NOK"
}
},
"ID_366": {
"value": "0",
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},
"ID_367": {
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}
},
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},
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},
"ID_111": {
"value": "NOTE 1
Company information and basis of preparation
\u00a0
Telenor
\u00a0
is
\u00a0
a
\u00a0
Norwegian
\u00a0
listed
\u00a0
company
\u00a0
offering
telecommunications services
\u00a0
in
\u00a0
the
\u00a0
Nordics
\u00a0
and
\u00a0
Asia.
The
\u00a0
consolidated
\u00a0
financial
\u00a0
statements
\u00a0
of
\u00a0
Telenor
\u00a0
are
prepared according to IFRS. The accounting policies
\u00a0
are
described in
\u00a0
this note
\u00a0
and in
\u00a0
the individual
\u00a0
notes to
\u00a0
the
financial statements.
Company information
The consolidated financial statements of Telenor (referred
\u00a0
to as \u201cthe
company\u201d)
\u00a0
comprise the parent company and its subsidiaries.
\u00a0
The
parent company
Telenor ASA
public limited company
listed on the Oslo Stock exchange under
\u00a0
the ticker TEL.
\u00a0
The principal
activities
\u00a0
of Telenor
\u00a0
are described
\u00a0
in note 2
\u00a0
Segments.
\u00a0
The headquarter
is at
Snar\u00f8yveien 30, N-1360 Fornebu, Norway
number is +47 810 77 000.
Basis of preparation
The consolidated financial statements are prepared in accordance with
International Financial Reporting Standards (IFRS) as adopted by
\u00a0
the
European Union (EU) and the additional requirements
\u00a0
of the Norwegian
Accounting Act.
\u00a0
The consolidated financial statements were approved
by the Board of Directors on 21
\u00a0
March 2023 and is subject to approval by
the Annual General Meeting on 10 May 2023.
The consolidated financial statements have been prepared
\u00a0
on a
historical cost basis, except for equity investments
\u00a0
(primarily
shareholdings of less than 20%) and derivative
\u00a0
financial instruments,
which are
\u00a0
carried at
\u00a0
fair value.
\u00a0
The financial
\u00a0
year corresponds
\u00a0
to the
calendar year. The consolidated financial statements are
\u00a0
presented in
Norwegian Kroner (NOK). Amounts are rounded to
\u00a0
the nearest million,
unless otherwise
\u00a0
stated. As
\u00a0
a result
\u00a0
of rounding
\u00a0
adjustments,
\u00a0
amounts
and percentages
\u00a0
may not add
\u00a0
up to the
\u00a0
total.
The merger of Digi with Celcom was
\u00a0
completed in November 2022,
resulting
\u00a0
in Digi being
\u00a0
deconsolidated
\u00a0
from the
\u00a0
Telenor
\u00a0
group and
\u00a0
the
remaining 33.1% ownership being recognised as an associate. The
transaction resulted in a gain for Telenor
\u00a0
of NOK 32.7 billion. Historical
figures
\u00a0
have been
\u00a0
represented
\u00a0
as discontinued
\u00a0
operations,
\u00a0
refer to
further information
\u00a0
in note
\u00a0
12.
Accounting policies
Descriptions
\u00a0
of accounting principles are generally included in the
various notes to the financial statements. The general principles
\u00a0
relating
to foreign
\u00a0
currency
\u00a0
translation,
\u00a0
distinction
\u00a0
between
\u00a0
current
\u00a0
and non-
current assets and liabilities and government grants
\u00a0
are described
below.
Foreign currency
\u00a0
translation
\u00a0
The consolidated financial statements are presented in
\u00a0
NOK, which is
Telenor ASA\u2019s functional currency. The group has foreign
\u00a0
entities with
functional
\u00a0
currency
\u00a0
other than
\u00a0
NOK. At
\u00a0
the reporting
\u00a0
date, the
\u00a0
assets
and liabilities of foreign entities with functional
\u00a0
currencies other than
NOK are translated
\u00a0
into NOK at
\u00a0
the rate
\u00a0
of exchange
\u00a0
at the reporting
date. The income statements are translated at the
\u00a0
average exchange
rates for
\u00a0
the year
\u00a0
except significant
\u00a0
transactions
\u00a0
that are
\u00a0
translated
using the daily exchange rate. The translation
\u00a0
differences arising from
the translation are recognised in other comprehensive
\u00a0
income until the
disposal of the net investment, at
\u00a0
which time they are recognised in the
income statement.
Current/non-current
\u00a0
classification
An asset or liability is classified as current
\u00a0
when it is expected to be
realised, sold, used or settled in Telenor\u2019s
\u00a0
normal operating cycle, which
is normally
\u00a0
within twelve
\u00a0
months after
\u00a0
the reporting
\u00a0
date. Other
\u00a0
assets
and liabilities are classified as non-current.
\u00a0
Financial instruments, other
than those held for trading, are classified
\u00a0
based on maturity, and
hedging instruments are classified consistently with the underlying
hedged item.
Government grants are recognised when there is
\u00a0
reasonable assurance
that the grant
\u00a0
will be
\u00a0
received.
\u00a0
Grants that
\u00a0
relate to
\u00a0
expenses
\u00a0
are
normally recognised as a reduction of the
\u00a0
expense over the related
period.
\u00a0
Grants that relate to assets
\u00a0
are deducted from the carrying
amount of the asset and result in
\u00a0
lower depreciation over the useful life
of the asset.
Key judgments
\u00a0
and estimates
The preparation of consolidated financial statements of Telenor
involves significant
\u00a0
judgements
\u00a0
and estimates
\u00a0
that could
\u00a0
result in
material adjustments to the carrying amount of
\u00a0
the asset or liability the
next financial year. Management is required to make
\u00a0
difficult, subjective
and complex
\u00a0
assessments
\u00a0
of the outcome
\u00a0
of matters
\u00a0
that are
inherently uncertain on an ongoing basis. The key
\u00a0
judgments and
estimates
\u00a0
are based
\u00a0
on historical
\u00a0
results and
\u00a0
experience,
\u00a0
consultations
with experts,
\u00a0
trends, forecasts
\u00a0
and scenarios
\u00a0
of future
\u00a0
development
and other methods which management considers reasonable
\u00a0
under the
circumstances.
\u00a0
Information about key judgments and estimates are
included in the individual notes. The following notes
\u00a0
include the most
significant judgments and estimates in the consolidated
\u00a0
financial
statements
\u00a0
of Telenor:
\u25cf
Note 10 Income
\u00a0
taxes
\u25cf
Note 14 Goodwill
\u25cf
Note 16 Right-of-use
\u00a0
assets
\u25cf
Note 17 Property,
\u00a0
plant and
\u00a0
equipment
\u25cf
Note 18 Impairment
\u00a0
of assets
\u25cf
Note 22 Provisions
\u00a0
and obligations
\u25cf
Note 23 Legal disputes and contingencies
Adoption of
\u00a0
new and revised
\u00a0
standards, amendments
and interpretations
The accounting policies applied are consistent with
\u00a0
those applied in the
previous financial year, except for the implementation
\u00a0
of new and
revised accounting standards as described below. The
\u00a0
amendments
adopted with effect from 1 January 2022 relevant
\u00a0
for Telenor include:
\u00a0
\u25cf
Onerous contracts - cost of fulfilling a
\u00a0
contract (amendments to IAS
37
Provisions,
\u00a0
Contingent
\u00a0
Liabilities
\u00a0
and Contingent
\u00a0
Assets:
Onerous Contracts
\u00a0
- Cost of
\u00a0
Fulfilling
\u00a0
a Contract)
scope amendments
\u00a0
clarify
\u00a0
that the cost
\u00a0
of fulfilling
\u00a0
an onerous
contract includes
\u00a0
both incremental
\u00a0
cost and
\u00a0
an allocation
\u00a0
of other
costs that
\u00a0
relate directly
\u00a0
to fulfilling
\u00a0
the contract.
\u00a0
The
implementation
\u00a0
did not have
\u00a0
a significant
\u00a0
impact on
\u00a0
Telenor\u2019s
consolidated financial statements.
Telenor
\u00a0
has not early
\u00a0
adopted
\u00a0
any standard,
\u00a0
interpretation
\u00a0
or
amendment
\u00a0
that has been
\u00a0
issued but
\u00a0
is not yet
\u00a0
effective.
\u00a0
The
amendments are effective from 1 January 2023 are
\u00a0
not expected to
have a significant
\u00a0
impact on
\u00a0
the consolidated
\u00a0
financial
\u00a0
statements.
NOTE 2
Segments
The segments are consistent with the countries where Telenor
\u00a0
operates within mobile and fixed line
communication. Telenor had seven operating segments
\u00a0
at year-end 2022, of which four were in the Nordics and
three in Asia. Digi in Malaysia merged with Celcom in November 2022
\u00a0
and is no longer a segment of Telenor, but an
associated company.
\u00a0
Accounting policies
Reporting segments are identified based on reporting
\u00a0
to Group Management Team (chief operating decision makers)
\u00a0
and is consistent with
financial information used for assessing performance and allocating
\u00a0
resources during 2022 and 2021. The accounting principles
\u00a0
for the segment
reporting
\u00a0
are consistent
\u00a0
with those
\u00a0
applied by
\u00a0
the Group.
\u00a0
The operating
\u00a0
and reportable
\u00a0
segments
\u00a0
are based
\u00a0
on business
\u00a0
activities
\u00a0
and
geographical
\u00a0
location.
\u00a0
The segment
\u00a0
result
\u00a0
is defined
\u00a0
as EBITDA
\u00a0
before other
\u00a0
income and
\u00a0
other expenses.
Deliveries of network-based regulated services are based
\u00a0
on cost-oriented prices based on
\u00a0
negotiations between the units. All transactions
between the segments are based on market conditions. Gains
\u00a0
and losses arising from internal transfer of
\u00a0
businesses, group contribution and
dividends
\u00a0
within the
\u00a0
Group are
\u00a0
not included
\u00a0
in the income
\u00a0
statements
\u00a0
for the segments.
Segments
The countries
\u00a0
where Telenor
\u00a0
operates
\u00a0
is the basis
\u00a0
for the segment
\u00a0
reporting.
\u00a0
The mobile
\u00a0
communication
\u00a0
business mainly
\u00a0
includes
\u00a0
voice, data,
internet, content services, customer equipment and messaging.
\u00a0
In Norway, Sweden, Denmark and Finland, the
\u00a0
fixed line businesses are reported
together with mobile operations. Fixed services comprise
\u00a0
telephony, internet and TV and leased lines, as well
\u00a0
as data services and managed
services.
Other units consist of Corporate Functions, Telenor
\u00a0
Infra, Telenor Satellite and Other Businesses. Corporate Functions
\u00a0
comprise activities such as
global shared services, research and development, strategic
\u00a0
Group projects, Group Treasury, the internal insurance
\u00a0
company, and support
functions. Telenor Infra operates all tower infrastructure
\u00a0
in Norway previously operated by Telenor Norway,
\u00a0
Norkring and Telenor Real Estate.
Telenor
\u00a0
Satellite
\u00a0
offers broadcasting
\u00a0
and data
\u00a0
communication
\u00a0
services
\u00a0
via satellite.
\u00a0
Other Businesses
\u00a0
consists mainly
\u00a0
of mobile
\u00a0
communication
business at sea conducted by Telenor Maritime;
\u00a0
Telenor Linx, which is focused on interconnecting global
\u00a0
operators and delivering key
communications services on a global scale; Telenor Real
\u00a0
Estate; Telenor Connexion, which is specialising in Internet
\u00a0
of Things with capabilities to
support the most advanced machine-to-machine-communication
\u00a0
and Internet of Things customers worldwide;
\u00a0
and other businesses, including
internet
\u00a0
based services,
\u00a0
none of which
\u00a0
are material
\u00a0
enough to
\u00a0
be reported
\u00a0
as separate
\u00a0
segments.
\u00a0
Change in composition
\u00a0
of reportable
\u00a0
segments
In 2022,
\u00a0
Telenor announced
\u00a0
the new
\u00a0
organisation
\u00a0
to take effect
\u00a0
from 2023.
\u00a0
As a consequence,
\u00a0
the current
\u00a0
country-based
\u00a0
segment reporting
\u00a0
will be
discontinued and replaced with the following four
\u00a0
operating segments
\u00a0
from the first quarter 2023: Nordics, Asia,
\u00a0
Infrastructure and Amp. The
mobile and fixed line businesses will be reported
\u00a0
in the Nordic and Asia segments.
\u00a0
The Infrastructure segment will consists of certain
\u00a0
passive
infrastructure
\u00a0
in the Nordics,
\u00a0
whereas
\u00a0
the Amp segment
\u00a0
will consist
\u00a0
of the portfolio
\u00a0
of adjacent
\u00a0
business and
\u00a0
companies
\u00a0
that are
\u00a0
near the
\u00a0
core of
Telenor\u2019s
\u00a0
business.
\u00a0
Pursuant to closing of the merger between
\u00a0
Digi and Celcom in Malaysia on 30
\u00a0
November 2022, Digi as a subsidiary is classified
\u00a0
as discontinued
operations with comparative figures re-presented. Telenor\u2019s ownership
\u00a0
in the merged entity CelcomDigi is recognised as
\u00a0
associated company
using the equity method,
\u00a0
see note 35. The share of profits
\u00a0
or losses from CelcomDigi will be included in the Asia
\u00a0
segment from Q1 2023.
\u00a0
Segment Information
\u00a0
2022
NOK in millions
Revenues
External revenues
EBITDA before
other
expenses
1)
EBITDA
1)
Depreciation,
(loss)
Investments
2)
Capital employed
3)
Norway
25 400
24 959
12 236
11 853
(7 146)
4 707
6 849
28 033
Sweden
11 712
11 620
4 033
5 729
(2 525)
3 204
2 016
14 720
Denmark
5 510
5 414
1 396
1 375
( 910)
465
934
5 013
DNA - Finland
10 074
10 031
3 681
3 678
(2 614)
1 064
1 387
33 665
dtac - Thailand
22 107
22 076
8 181
8 020
(6 155)
1 865
3 168
37 823
Grameenphone -
Bangladesh
15 508
15 392
9 685
9 441
(2 870)
6 571
3 701
9 086
Pakistan
5 188
4 822
2 891
2 888
(3 917)
(1 028)
2 188
7 586
Other units
9 061
4 639
2 409
2 299
(1 292)
1 007
2 042
n.m.
Eliminations
(5 606)
-
(2 139)
(2 166)
1 658
( 509)
-
n.m.
Group
98 953
98 953
42 374
43 117
(25 770)
17 346
22 284
n.m.
Segment Information
\u00a0
2021
NOK in millions
Revenues
External revenues
EBITDA before
other expenses
1)
EBITDA
1)
Depreciation,
(loss)
Investments
2)
Capital employed
3)
Norway
25 362
24 915
12 758
11 726
(6 739)
4 987
5 637
25 378
Sweden
12 107
12 038
4 434
4 428
(2 651)
1 777
1 839
16 242
Denmark
5 346
5 259
1 413
1 362
( 927)
434
1 077
4 621
DNA - Finland
9 712
9 678
3 645
3 643
(2 651)
993
1 625
33 951
dtac - Thailand
21 878
21 826
8 067
7 934
(6 050)
1 884
3 852
39 701
Grameenphone -
Bangladesh
14 464
14 362
9 052
8 730
(2 327)
6 403
2 853
7 976
Pakistan
5 604
5 328
2 976
2 967
(1 751)
1 216
3 129
8 886
Other units
7 518
3 747
1 508
1 323
(1 231)
92
1 027
n.m.
Eliminations
(4 838)
-
(1 196)
(1 212)
1 080
( 132)
-
n.m.
Group
97 153
97 153
42 656
40 902
(23 247)
17 654
21 038
n.m.
1)
See table below for definition and reconciliation of EBITDA.
\u00a0
2)
Investments consist of capex and investments in businesses.
\u00a0
See page 180 for alternative performance measures.
\u00a0
3)
Capital employed (average for the period) adjusted
\u00a0
for dividend and group contribution payables/receivables.
For definition of capital employed and Group
figures, see page 180 for alternative performance measures.
\u00a0
(n.m. \u2013 not measured)
Reconciliation
NOK in millions
2022
2021
EBITDA before
\u00a0
other income
\u00a0
and other expenses
42 374
42 656
Other income
2 004
172
Other expenses
(1 261)
(1 926)
EBITDA
43 117
40 902
Geographical
\u00a0
distribution of
\u00a0
external revenues
\u00a0
based on customer
\u00a0
location
NOK in millions
2022
2021
Norway
25 826
25 730
Sweden
12 806
12 810
Denmark
5 563
5 423
Finland
9 940
9 528
Thailand
22 086
21 866
Bangladesh
15 390
14 360
Pakistan
4 829
5 343
Other countries
2 513
2 094
Total revenues
98 953
97 153
Assets by geographical
\u00a0
location of the
\u00a0
company
Non-current
\u00a0
assets excluding
\u00a0
deferred tax
assets,
\u00a0
contract cost
\u00a0
and other
\u00a0
non-current
Total assets
NOK in millions
2022
2021
2022
2021
Norway
35 559
34 503
54 233
56 423
Sweden
16 120
17 349
23 191
22 803
Denmark
4 448
3 921
7 703
7 723
Finland
34 868
33 985
40 692
38 522
Thailand
37 814
37 973
47 219
47 305
Malaysia
34 436
13 266
34 448
17 333
Bangladesh
14 071
12 958
17 576
16 648
Pakistan
7 837
10 536
10 287
12 784
Myanmar
-
349
-
2 543
Other countries
2 902
2 816
3 899
3 658
Total assets
188 055
167 657
239 249
225 740
NOTE 4
Costs of materials and traffic charges
Cost of materials
\u00a0
and traffic charges
NOK in millions
2022
2021
(11 823)
(11 397)
Cost of materials
\u00a0
etc
(14 580)
(14 194)
Total costs of materials and traffic charges
(26 404)
(25 591)
Cost of materials
\u00a0
include
\u00a0
variable lease
\u00a0
expenses,
\u00a0
see note
\u00a0
16 for more
\u00a0
information.
Power purchase agreements
As part of
\u00a0
Telenor\u2019s
\u00a0
commitment
\u00a0
to reduce
\u00a0
our greenhouse
\u00a0
gas emissions
\u00a0
and meet
\u00a0
our science-based
\u00a0
targets,
\u00a0
Telenor
\u00a0
has in 2022
\u00a0
entered into
Power Purchase Agreements with different vendors for
\u00a0
the provision of renewable energy to Telenor\u2019s
\u00a0
operations. These agreements are fixed
price agreements
\u00a0
and the first
\u00a0
agreement
\u00a0
is expected
\u00a0
to be effective
\u00a0
from end
\u00a0
of 2023.
\u00a0
As these agreements
\u00a0
are entered
\u00a0
into and will
\u00a0
continue to
be held
\u00a0
for the purpose
\u00a0
of receiving
\u00a0
energy for
\u00a0
own usage
\u00a0
within Telenor\u2019s
\u00a0
operations,
\u00a0
they will
\u00a0
be recognised
\u00a0
as cost of
\u00a0
materials
\u00a0
and traffic
charges when effective.
NOTE 5
Salaries and personnel costs
The Group has around 14 000 full-time equivalent employees.
\u00a0
The employees have various benefits in addition to
salary, including a share-based payment program that is described
\u00a0
in this note.
\u00a0
Overview of
\u00a0
salary and personnel
\u00a0
costs
NOK in millions
2022
2021
Salaries
\u00a0
and holiday
\u00a0
pay
(8 753)
(8 688)
( 924)
( 910)
Pension costs
\u00a0
including
\u00a0
social security
\u00a0
tax (note
\u00a0
21)
(1 004)
(1 039)
Share-based
\u00a0
payments
( 116)
( 131)
Other personnel
\u00a0
costs
( 468)
( 466)
Own work capitalised
1 268
1 219
Total salaries and personnel costs
(9 998)
(10 014)
1)
Include expenses related to the Group's employee share
\u00a0
programme, and the Group's long term incentive
\u00a0
programme for managers and key personnel
\u00a0
(please
refer to note 37 as well as chapter 11 of the Corporate
\u00a0
Governance section of the Board of Directors\u2019
\u00a0
report).
The average number of labour-years employed in continuing
\u00a0
operations was approximately 14 000 in 2022 and 15 000
\u00a0
in 2021.
\u00a0
Share-based payment program
Employees
\u00a0
and managers
\u00a0
worldwide
\u00a0
are offered
\u00a0
to purchase
\u00a0
Telenor shares
\u00a0
at a discounted
\u00a0
price and
\u00a0
potentially
\u00a0
earn bonus
\u00a0
shares if
\u00a0
the share
price exceeds certain benchmarks in the future.
\u00a0
Bonus shares are awarded net after tax
\u00a0
and Telenor withhold and pay withholding taxes on behalf
of the employee. The share-based payment programs including
\u00a0
the withholding tax are considered as equity-settled share-based
\u00a0
payments, where
the fair
\u00a0
value of
\u00a0
the bonus
\u00a0
shares is
\u00a0
estimated
\u00a0
at the grant
\u00a0
date and
\u00a0
expensed
\u00a0
over the
\u00a0
vesting period.
\u00a0
Social security
\u00a0
taxes are
\u00a0
recognised
\u00a0
as
cash-settled share-based payments measured at fair value
\u00a0
and remeasured at each reporting date.
NOTE 6
Other operating expenses
Other operating
\u00a0
expenses
NOK in millions
2022
2021
Other cost of premises, vehicles, office equipment
\u00a0
etc.
(2 668)
(2 196)
Operation
\u00a0
and maintenance
(5 574)
(5 470)
Marketing
\u00a0
and sales
\u00a0
commission
(4 629)
(4 394)
Advertising
(1 530)
(1 598)
External personnel and consultancy fees
(1 950)
(1 800)
Variable lease expenses
1)
(2 145)
(2 057)
Other
2)
(1 682)
(1 375)
Total other operating expenses
(20 178)
(18 891)
1)
See note 16 for more information.
2)
Includes expenses related to short term and low
\u00a0
value leases, see note 16 for more information.
NOTE 7
Research and development costs
The research and development activities in Telenor mainly relate
\u00a0
to developing new services and products,
development of networks,
\u00a0
Artificial Intelligence (AI) and advanced analytics, safeguarding
\u00a0
of personal data and
cyber security. All research and development costs in Telenor are
\u00a0
expensed as they do not meet the requirements
in IFRS for capitalisation.
Accounting policies
Development expenditures
\u00a0
are capitalised only when the criteria for
\u00a0
recognition are met, i.e. that it is probable
\u00a0
that the expected future economic
benefits that are attributable to the asset
\u00a0
will flow to the entity, management has
\u00a0
committed itself to complete the asset, the
\u00a0
technical feasibility of
completing the asset has been demonstrated and
\u00a0
the cost can be measured reliably. The assets
\u00a0
are amortised over their expected useful life
\u00a0
once
the assets
\u00a0
are available
\u00a0
for use.
\u00a0
Costs incurred
\u00a0
during the
\u00a0
research
\u00a0
stage of
\u00a0
a project,
\u00a0
as well
\u00a0
as maintenance
\u00a0
and training
\u00a0
costs are
\u00a0
expensed
\u00a0
as
incurred.
\u00a0
Development
\u00a0
costs that
\u00a0
do not meet
\u00a0
the criteria
\u00a0
for capitalisation
\u00a0
are expensed
\u00a0
as incurred.
Research and
\u00a0
development costs
Research and development costs that have
\u00a0
been recognised in the income statement amount
\u00a0
to NOK 177 million in 2022 (NOK 187
\u00a0
million in 2021).
Expensed research and development activities mainly related
\u00a0
to new technologies, 5G projects, security awareness
\u00a0
and network optimisation.
NOTE 8
Other income and other expenses
Income and expenses not regarded as part of regular operational performance
\u00a0
are presented on a separate line as
other income and other expenses in Telenor. It includes gains and losses
\u00a0
on disposal of PPE and other non-current
assets, restructuring costs, losses from onerous contracts
\u00a0
and fines concluded in legal disputes.
\u00a0
Accounting policies
Other income and other expenses are items
\u00a0
that are not regarded as part of
\u00a0
regular operational performance. The purpose of presenting these
items on a separate line is to enable
\u00a0
comparison of profitability between periods. It includes gains
\u00a0
and losses on disposal of non-current
\u00a0
assets
such as property,
\u00a0
plant and
\u00a0
equipment
\u00a0
(PPE) and
\u00a0
intangible
\u00a0
assets. It
\u00a0
also includes
\u00a0
gains and
\u00a0
losses from
\u00a0
sale of
\u00a0
subsidiaries,
\u00a0
unless the
\u00a0
sale is
presented as discontinued operations. Restructuring costs are
\u00a0
included to the extent they qualify as
\u00a0
a restructuring in IAS 37. Costs related to
reduction
\u00a0
of personnel
\u00a0
is only included
\u00a0
when they
\u00a0
relate to
\u00a0
the time the
\u00a0
employee
\u00a0
no longer
\u00a0
render services
\u00a0
to Telenor.
\u00a0
Costs for loss
\u00a0
contracts
\u00a0
are
included when they qualify as onerous contracts
\u00a0
under IAS 37. Fines concluded in legal disputes
\u00a0
are included, whereas settlements on legal
disputes
\u00a0
are only
\u00a0
included
\u00a0
in other
\u00a0
income and
\u00a0
expense
\u00a0
when they
\u00a0
relate to
\u00a0
the business
\u00a0
as a whole
\u00a0
and are
\u00a0
non-recurring
\u00a0
in nature.
Other income
\u00a0
and other expenses
NOK in millions
2022
2021
Gains on disposals
\u00a0
of property,
\u00a0
plant and
\u00a0
equipment
\u00a0
(PPE), right-of-use
\u00a0
assets and
\u00a0
operations
1 954
144
Other
50
28
Total other income
2 004
172
Losses on
\u00a0
disposals
\u00a0
of property,
\u00a0
plant and
\u00a0
equipment
\u00a0
(PPE), right-of-use
\u00a0
assets and
\u00a0
operations
(462)
(464)
Expenses
\u00a0
for workforce
\u00a0
reductions,
\u00a0
onerous contracts
\u00a0
and other
(800)
(1 462)
Total other expenses
(1 261)
(1 926)
For the year 2022, total other income
\u00a0
consisted mainly of NOK 1.7 billion gain
\u00a0
on divestment of fixed non-core assets and
\u00a0
NOK 95 million related to
gain on sale of licenses in Telenor Sweden.
\u00a0
Total other expenses consisted mainly of workforce
\u00a0
reductions (of which NOK 392 million in Telenor
Norway and NOK 180 million in Grameenphone)
\u00a0
and NOK 150 million damaged fixed assets
\u00a0
in a fire in dtac.
In 2021,
\u00a0
total other
\u00a0
expenses
\u00a0
consisted
\u00a0
mainly of
\u00a0
a fine from
\u00a0
the Norwegian
\u00a0
Competition
\u00a0
Authority
\u00a0
(NOK 788
\u00a0
million),
\u00a0
losses on termination
\u00a0
of
leases in
\u00a0
dtac (NOK
\u00a0
138 million)
\u00a0
and workforce
\u00a0
reductions
\u00a0
(of which
\u00a0
NOK 338 million
\u00a0
in Grameenphone
\u00a0
and NOK 168
\u00a0
million in
\u00a0
Telenor Norway).
NOTE 9
Financial income and expenses
Financial income in Telenor includes interest income on cash
\u00a0
and cash equivalents as well as customer credit. The
interest expenses mainly relate to bonds,
\u00a0
derivatives, and other borrowings in addition to lease liabilities.
\u00a0
Other
financial items include foreign currency gains and losses and
\u00a0
change in fair value of hedging instruments and
hedged items.
Accounting policies
Interest expenses related
\u00a0
to bonds,
\u00a0
commercial papers, bank loans and bank overdrafts are
\u00a0
recognised at amortised
\u00a0
cost using the effective
interest-rate method.
\u00a0
Foreign currency gains and losses arise from
\u00a0
monetary assets and liabilities denominated in foreign
\u00a0
currencies translated to
the functional currency. All exchange differences are
\u00a0
recognised in the income statement except exchange differences
\u00a0
on foreign currency
borrowings and monetary items that provide an
\u00a0
effective hedge against a net investment in
\u00a0
a foreign entity.
\u00a0
These gains and losses are recognised
in other comprehensive income until the disposal
\u00a0
of the net investment or settlement of
\u00a0
the monetary item, at which time they
\u00a0
are recognised in
the income statement. Dividend income from investments is
\u00a0
recognised when the Group\u2019s rights to receive
\u00a0
payment have been established
(declared by the General Meeting or otherwise) and
\u00a0
classified as financial income.
Financial income
\u00a0
and expenses
NOK in millions
2022
2021
Interest income
\u00a0
on cash and
\u00a0
cash equivalents
290
279
Other financial
\u00a0
income
162
137
Total financial
\u00a0
income
452
417
Interest expenses on financial liabilities
1)
(2 640)
(2 485)
Other financial
\u00a0
expenses
(1 132)
( 498)
Total financial expenses
(3 772)
(2 983)
Foreign currency gains
1 644
2 451
Foreign
\u00a0
currency
\u00a0
losses
(5 028)
(3 521)
Net foreign currency gains (losses)
(3 384)
(1 070)
Net change
\u00a0
in fair
\u00a0
value of
\u00a0
financial
\u00a0
instruments
\u00a0
at fair
\u00a0
value through
\u00a0
profit or
\u00a0
loss
592
201
Net change in fair value of hedging
\u00a0
instruments and hedged items
( 200)
( 44)
Net gains (losses and impairment) on financial assets
\u00a0
and liabilities
1
7
Other changes
393
165
Net financial
\u00a0
income (expenses)
(6 312)
(3 472)
4)
Includes interest expenses on lease liabilities, see note
\u00a0
16 for more information.
In 2022,
\u00a0
interest expenses
\u00a0
related to
\u00a0
interest-bearing
\u00a0
debt amounts
\u00a0
to NOK 1.6
\u00a0
billion,
\u00a0
an increase
\u00a0
of NOK 0.1
\u00a0
billion compared
\u00a0
to 2021.
\u00a0
This increase
is mainly explained by higher interest rates. Further, interest expenses
\u00a0
on lease liabilities amounts to NOK 1.1
\u00a0
billion in 2022 and 2021. Other financial
expenses for 2022 includes provision for regulatory
\u00a0
disputes in Bangladesh.
Net foreign currency losses were NOK 3.4
\u00a0
billion in 2022, compared to losses of NOK
\u00a0
1.1 billion in 2021. The net foreign currency
\u00a0
losses in 2022 was
mainly related to translation of debt denominated
\u00a0
in USD used for economic hedges of
\u00a0
assets, USD liabilities in Pakistan as well as
\u00a0
internal loans in
SGD within
\u00a0
Telenor
\u00a0
Group. The
\u00a0
net foreign
\u00a0
currency
\u00a0
losses in
\u00a0
2021 was
\u00a0
mainly related
\u00a0
to translation
\u00a0
of debt
\u00a0
denominated
\u00a0
in USD used
\u00a0
for economic
hedges of assets and USD liabilities in
\u00a0
Pakistan.
NOTE 10
Income taxes
Telenor is in a payable tax position in most jurisdictions. Nevertheless,
\u00a0
Telenor had a net tax income in 2022 of
27.1% as a result of favourable development in a tax dispute in Norway
\u00a0
and realisation of tax losses from
restructuring of shareholdings in Asia. Telenor is involved
\u00a0
in several legal proceedings and discussions related to
its tax position where the outcome is uncertain. Uncertain tax positions
\u00a0
may require significant judgment including
assessment of future taxable profits and estimating the outcome
\u00a0
of significant tax disputes.
\u00a0
Accounting policies
Telenor bases its assessment of taxable income
\u00a0
on interpretation of relevant laws and regulations,
\u00a0
and when it is considered as probable that the
tax treatment
\u00a0
will be
\u00a0
sustained
\u00a0
in a tax
\u00a0
review. Current
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are measured
\u00a0
at the amount
\u00a0
expected
\u00a0
to be recovered
\u00a0
or paid
\u00a0
to
the tax authorities.
\u00a0
Deferred
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are calculated
\u00a0
using the
\u00a0
liability
\u00a0
method where
\u00a0
deferred
\u00a0
taxes are
\u00a0
recognised
\u00a0
on the
difference between the tax base and the
\u00a0
carrying amount of the assets and liabilities,
\u00a0
including tax losses carried forward. Deferred tax assets and
liabilities
\u00a0
are not recognised
\u00a0
on goodwill
\u00a0
or on investments
\u00a0
in subsidiaries,
\u00a0
associates,
\u00a0
or joint
\u00a0
ventures
\u00a0
where the
\u00a0
timing of
\u00a0
the reversal
\u00a0
can be
controlled,
\u00a0
and it is
\u00a0
probable
\u00a0
that the temporary
\u00a0
difference
\u00a0
will not be
\u00a0
reversed
\u00a0
in the foreseeable
\u00a0
future. Deferred
\u00a0
tax assets
\u00a0
are only
\u00a0
recognised
\u00a0
to
the extent
\u00a0
it is more
\u00a0
likely than
\u00a0
not that the
\u00a0
tax assets
\u00a0
will be
\u00a0
utilised.
\u00a0
Deferred
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are offset
\u00a0
when there
\u00a0
is a legally
\u00a0
enforceable
right, Telenor
\u00a0
is capable
\u00a0
to and intends
\u00a0
to settle
\u00a0
on a net
\u00a0
basis. The
\u00a0
enacted tax
\u00a0
rates at
\u00a0
the end of
\u00a0
the reporting
\u00a0
period and
\u00a0
undiscounted
\u00a0
amounts
are used. A change in deferred tax assets
\u00a0
and liabilities because of change in tax rates
\u00a0
is recognised in profit or loss, except when
\u00a0
it relates to items
that previously was recognised in other comprehensive income
\u00a0
or directly in equity. Deferred tax is provided for
\u00a0
undistributed earnings in
subsidiaries when distribution is expected in foreseeable future.
\u00a0
Deferred tax for undistributed earnings in associated
\u00a0
companies is provided for as
the timing
\u00a0
of the reversal
\u00a0
of the temporary
\u00a0
differences
\u00a0
cannot be
\u00a0
controlled
\u00a0
by Telenor.
Key judgments
\u00a0
and estimates
\u00a0
Significant judgements are required when assessing uncertain
\u00a0
tax assets, like tax losses carried forward. Such
\u00a0
judgment may include assessment
of taxable
\u00a0
profits in
\u00a0
futures years
\u00a0
as well
\u00a0
as tax planning
\u00a0
strategies
\u00a0
and the existence
\u00a0
of taxable
\u00a0
temporary
\u00a0
differences.
\u00a0
Entities
\u00a0
with a history
\u00a0
of
recent losses need convincing evidence that sufficient
\u00a0
future taxable profit will be generated before a tax
\u00a0
asset is recognised. Uncertainty related
to new transactions
\u00a0
and events
\u00a0
and the
\u00a0
interpretation
\u00a0
of new tax
\u00a0
rules may
\u00a0
also affect
\u00a0
these judgements.
Telenor is involved in various legal proceedings, disputes
\u00a0
and claims related to its income tax positions
\u00a0
where the outcomes is subject to significant
uncertainty. The management assessment may include interpretation
\u00a0
of relevant laws, regulations, and the outcome
\u00a0
of similar tax disputes in the
same jurisdiction, expert opinions from external tax
\u00a0
advisors and communication with the tax authorities.
\u00a0
A tax provision is recognised when an
unfavourable outcome is considered probable, and a
\u00a0
reliable estimate can be made. In Norway,
\u00a0
a formal decision made by the tax
\u00a0
authorities or
lower courts is presumed to represent the
\u00a0
best estimate for accounting purposes unless expert
\u00a0
opinions can point to errors clearly
\u00a0
indicating that
the tax assessment is incorrect. The tax
\u00a0
provision is updated whenever the assumptions change.
\u00a0
Tax disputes are disclosed in this note if they
\u00a0
are
considered
\u00a0
significant
\u00a0
for Telenor.
\u00a0
See also
\u00a0
note 23 Legal
\u00a0
Disputes
\u00a0
and contingencies.
Income tax expense
NOK in millions
2022
2021
Profit before taxes
10 732
13 723
Current taxes
( 411)
(5 864)
Deferred taxes
3 325
855
Income taxes
2 914
(5 008)
Current taxes
In 2022 current taxes are impacted mainly
\u00a0
by current tax income of NOK 3.1 billion
\u00a0
in Norway (see below reversal of tax expense
\u00a0
for the India
guarantee
\u00a0
for Unitech
\u00a0
Wireless,
\u00a0
reversal
\u00a0
of tax provision
\u00a0
in Norway
\u00a0
related
\u00a0
to losses
\u00a0
on loans and
\u00a0
guarantees,
\u00a0
and prior
\u00a0
year assessments
\u00a0
or
adjustments on current tax) and current tax
\u00a0
expense of NOK 2.3 billion in Bangladesh.
\u00a0
Current taxes in 2021 were impacted mainly by a
\u00a0
fine paid by
Telenor
\u00a0
to the Norwegian
\u00a0
Competition
\u00a0
Authority
\u00a0
(NCA)
\u00a0
for a claim
\u00a0
on an alleged
\u00a0
breach of
\u00a0
the prohibition
\u00a0
against abuse
\u00a0
of a dominant
\u00a0
position (see
comments
\u00a0
below on
\u00a0
NCA case).
In 2022 deferred taxes
are impacted mainly by NOK 2.1 billion in
\u00a0
Norway, mainly due to realisation of tax losses
\u00a0
related to an internal legal
restructuring in Asia, and
\u00a0
NOK 1.1 billion in Pakistan mainly related to
\u00a0
the impairment of fixed assts.
Effective tax
\u00a0
rate
\u00a0
The table below reconciles the reported income
\u00a0
tax expense to the expected income tax
\u00a0
expense according to the Norwegian corporate income
tax rate of 22%. It also discloses
\u00a0
the main elements of the tax expense.
\u00a0
Comments are provided on selected line items in
\u00a0
the table below.
NOK in millions
2022
2021
Income tax expense at corporate income tax
\u00a0
rate in Norway 22%
(2 361)
(3 019)
Effect of
\u00a0
tax rates
\u00a0
outside Norway
\u00a0
different
\u00a0
from 22%
( 625)
(1 135)
Effect of
\u00a0
changes in
\u00a0
tax rates
13
-
Current and deferred taxes on retained earnings
\u00a0
and dividend in subsidiaries and associated companies
( 70)
( 98)
Tax income from restructuring in Asia
3 136
Reversal of tax expense for the India
\u00a0
guarantee for Unitech Wireless
\u00a0
2 491
Divestment of fixed non-core assets in
\u00a0
Telenor Sweden
356
Reversal
\u00a0
of tax provision
\u00a0
in Norway
\u00a0
related
\u00a0
to losses on
\u00a0
loans and
\u00a0
guarantees
330
( 173)
Other items
( 594)
( 624)
Prior years
\u00a0
assessments
\u00a0
or adjustments
\u00a0
on current
\u00a0
tax
297
34
Deferred tax assets not recognised current year
( 66)
1
Change in previously not recognised deferred tax
\u00a0
assets
\u00a0
6
6
Income taxes
2 914
(5 008)
Effective
\u00a0
tax rate
\u00a0
in %
-27.1
36.5
Tax rates outside Norway different from 22%
\u00a0
Effects are mainly related to Grameenphone Ltd.
\u00a0
(Bangladesh: 40%) and Telenor Pakistan (33%) having higher
\u00a0
nominal tax rates than the nominal
tax rate for Norway. Telenor Sweden (20.6%),
\u00a0
DNA (Finland: 20%) and dtac (Thailand: 20%)
\u00a0
have lower nominal tax rates.
Effect of changes in tax rates
Pakistan enacted an increase of their corporate
\u00a0
income tax rate from 29% to 33%
\u00a0
in 2022.
Current and deferred taxes on retained earnings and dividend
\u00a0
in subsidiaries and associated companies
\u00a0
Includes current taxes on dividends received, as
\u00a0
well as change in deferred tax liability (primarily withholding tax)
\u00a0
recognised on undistributed
earnings
\u00a0
in subsidiaries
\u00a0
and associated
\u00a0
companies
\u00a0
outside of
\u00a0
Norway. Deferred
\u00a0
taxes on
\u00a0
retained
\u00a0
earnings in
\u00a0
foreign
\u00a0
subsidiaries
\u00a0
are provided
\u00a0
for
in full as of 31 December 2022 and 2021.
\u00a0
Tax income from restructuring in Asia
As a part of Telenor\u2019s new strategy,
\u00a0
an internal restructuring process has been initiated
\u00a0
to form a new Singapore holding company for
\u00a0
all Asian
mobile operations.
\u00a0
Telenor India
\u00a0
is not a part
\u00a0
of the strategy
\u00a0
for Asia
\u00a0
going forward,
\u00a0
and therefore
\u00a0
the company
\u00a0
holding
\u00a0
the interests
\u00a0
in India
\u00a0
has
been transferred from Telenor Mobile Communications AS
\u00a0
to Telenor Communications II AS. A deductible
\u00a0
tax loss of NOK 14.3 billion
\u00a0
was realised
for Norwegian purposes by the transaction. The
\u00a0
deductibility is based on an advanced binding ruling
\u00a0
from Norwegian tax authorities.
Reversal of tax expense for the India guarantee for Unitech
\u00a0
Wireless
In 2012, Telenor ASA recorded a loss after
\u00a0
having repaid, as guarantor, all Unitech Wireless\u2019 interest-bearing
\u00a0
borrowings, amounting to NOK 10.6
billion.
\u00a0
A deferred
\u00a0
tax asset
\u00a0
of NOK 2.5
\u00a0
billion was
\u00a0
recognised.
\u00a0
In 2013, the
\u00a0
business transfer
\u00a0
from Unitech
\u00a0
Wireless
\u00a0
to Telenor
\u00a0
India was
\u00a0
completed,
and Telenor
\u00a0
ASA deducted
\u00a0
NOK 9.3 billion
\u00a0
as loss on
\u00a0
guarantees
\u00a0
in its tax
\u00a0
filing.
\u00a0
In 2019, Telenor
\u00a0
ASA has received
\u00a0
a reassessment
\u00a0
order from
\u00a0
the
Norwegian tax authorities disallowing deduction for the
\u00a0
loss, which increases previous years\u2019 current income
\u00a0
tax with NOK 2.5 billion in 2019. The
decision
\u00a0
was upheld
\u00a0
by the Tax
\u00a0
Appeal Board.
\u00a0
Telenor ASA
\u00a0
has appealed
\u00a0
the decision
\u00a0
to the district
\u00a0
court. On
\u00a0
28 March
\u00a0
2022, the
\u00a0
district
\u00a0
court
decided in favour of Telenor ASA, and
\u00a0
the tax expense was reversed with NOK
\u00a0
2.5 billion in 2022. The government has appealed the
\u00a0
ruling to the
Appeal
\u00a0
Court, and
\u00a0
the appeal
\u00a0
is scheduled
\u00a0
to be heard
\u00a0
in April
\u00a0
2023.
Divestment of fixed non-core assets in Telenor Sweden
Telenor Sweden sold Open Universe and the
\u00a0
company\u2019s fibre to the home (FTTH) accesses
\u00a0
in the single dwelling unit (SDU) segment
\u00a0
to Global
Connect for
\u00a0
a total
\u00a0
consideration
\u00a0
of NOK 3
\u00a0
billion.
\u00a0
The transaction
\u00a0
generated
\u00a0
a pre-tax
\u00a0
gain on
\u00a0
disposal
\u00a0
of NOK 1.7
\u00a0
billion.
Reversal
\u00a0
of tax provision
\u00a0
in Norway
\u00a0
related to
\u00a0
losses on
\u00a0
loans and
\u00a0
guarantees.
Telenor ASA claimed deductions for losses on
\u00a0
loans and guarantees related to the subsidiary
\u00a0
Cinclus Technology AS in 2008 with NOK
\u00a0
0.5 billion
and in 2011
\u00a0
with NOK
\u00a0
0.7 billion.
\u00a0
The Tax Office
\u00a0
disallowed
\u00a0
deductions
\u00a0
for 2008
\u00a0
by decision
\u00a0
of 21 December
\u00a0
2016, and
\u00a0
for 2011 by
\u00a0
decision of
\u00a0
21
February 2018. Telenor ASA appealed the decisions. On
\u00a0
6 June 2022, the Tax Appeal Board
\u00a0
decided that Telenor ASA should be allowed
deductions,
\u00a0
and the tax
\u00a0
expense
\u00a0
was therefore
\u00a0
reversed.
Fine imposed by the Norwegian Competition Authority (NCA)
In 2021
\u00a0
Telenor paid
\u00a0
a fine of
\u00a0
NOK 0.8 billion
\u00a0
to NCA for
\u00a0
a claim
\u00a0
from 21 June
\u00a0
2018. The
\u00a0
claim relates
\u00a0
to an alleged
\u00a0
breach of
\u00a0
the prohibition
\u00a0
against
abuse of
\u00a0
a dominant
\u00a0
position related
\u00a0
to the pricing
\u00a0
model in one
\u00a0
mobile wholesale
\u00a0
agreement
\u00a0
in the mobile
\u00a0
market in
\u00a0
the period
\u00a0
2010-2014,
\u00a0
see
note 23 Legal
\u00a0
Disputes
\u00a0
and contingencies.
\u00a0
Other items
In 2022 non-deductible items are in line
\u00a0
with last year.
Prior year assessments or adjustments on current tax
In 2022 it is mainly related to reversal
\u00a0
of previous years\u2019 current income for pipes
\u00a0
and digging costs in Norway.
Tax losses carried
\u00a0
forward
Tax losses carried forward in selected countries expire
\u00a0
as follows as of 31 December 2022:
NOK in millions
Norway
Denmark
Thailand
Other
Total
2023
-
-
591
-
591
2024
-
-
999
1
1 000
2025
-
-
327
14
340
2026
-
-
516
15
531
2027
-
-
939
20
959
2028 and later
-
-
-
319
319
Not time-limited
12 484
590
379
283
13 737
Total tax
\u00a0
losses carried
\u00a0
forward
12 484
590
3 751
653
17 477
Of which
\u00a0
deferred
\u00a0
tax assets
\u00a0
have not been
\u00a0
recognised
-
154
431
542
1 127
Of which deferred tax assets have been recognised
12 484
436
3 320
111
16 350
Tax losses carried forward in selected countries expire
\u00a0
as follows as of 31 December 2021:
NOK in millions
Norway
Denmark
Thailand
Other
Total
2022
-
-
139
-
139
2023
-
-
2 063
1
2 064
2024
-
-
938
1
939
2025
-
-
305
2
307
2026
-
-
700
14
714
2027 and later
-
-
-
334
334
Not time-limited
-
735
366
242
1 344
Total tax
\u00a0
losses carried
\u00a0
forward
-
735
4 512
594
5 841
Of which
\u00a0
deferred
\u00a0
tax assets
\u00a0
have not been
\u00a0
recognised
-
146
427
485
1 059
Of which deferred tax assets have been recognised
-
589
4 085
109
4 782
In 2022, tax losses carried forward, before and
\u00a0
after valuation allowance, increased by NOK 11.6
\u00a0
billion, mainly due to recognition of NOK
\u00a0
12.5 billion
tax losses
\u00a0
carried
\u00a0
forward in
\u00a0
Norway, partly
\u00a0
offset by
\u00a0
the utilisation
\u00a0
of tax losses
\u00a0
in Denmark
\u00a0
and Thailand.
\u00a0
In 2021,
\u00a0
tax losses
\u00a0
carried
\u00a0
forward,
before and
\u00a0
after valuation
\u00a0
allowance,
\u00a0
decreased
\u00a0
by NOK 1.6
\u00a0
billion and
\u00a0
NOK 1.5 billion,
\u00a0
respectively,
\u00a0
mainly due
\u00a0
to utilisation
\u00a0
of tax losses
\u00a0
in Denmark
and Thailand.
Tax assets recognised on tax losses carried forward
Norway,
\u00a0
Thailand and Denmark have recognised tax assets on
\u00a0
unused tax losses as the Group expects there
\u00a0
will be sufficient future taxable profits
available
\u00a0
to utilise
\u00a0
these losses.
Uncertain tax
\u00a0
positions
Pakistan
Telenor Pakistan has received reassessment orders from
\u00a0
the Tax Authority concerning deductibility of certain expenses
\u00a0
in tax returns and
disputing
\u00a0
the adjustment
\u00a0
of advance
\u00a0
income tax
\u00a0
paid on import
\u00a0
of equipment
\u00a0
with a total
\u00a0
exposure of
\u00a0
NOK 2.1
\u00a0
billion.
\u00a0
Telenor Pakistan
\u00a0
is of the
opinion that
\u00a0
the deductibility
\u00a0
of these expenses
\u00a0
is in accordance
\u00a0
with the tax
\u00a0
law in Pakistan
\u00a0
(also supported
\u00a0
by external
\u00a0
legal advisors),
\u00a0
hence
Telenor
\u00a0
Pakistan
\u00a0
disagrees
\u00a0
with the reassessment
\u00a0
orders and
\u00a0
has challenged
\u00a0
the orders,
\u00a0
which are
\u00a0
pending at
\u00a0
various appellate
\u00a0
forums.
In 2012, Telenor ASA recorded a loss on
\u00a0
receivables on its Indian subsidiary Unitech Wireless
\u00a0
after having repaid, as guarantor, all Unitech Wireless\u2019
interest-bearing
\u00a0
borrowings,
\u00a0
amounting
\u00a0
to NOK 10.6
\u00a0
billion.
\u00a0
A deferred
\u00a0
tax asset
\u00a0
of NOK 2.5
\u00a0
billion was
\u00a0
recognised.
\u00a0
In 2013,
\u00a0
after the
\u00a0
business
transfer from
\u00a0
Unitech Wireless
\u00a0
to Telenor
\u00a0
India was
\u00a0
completed,
\u00a0
Telenor ASA
\u00a0
deducted
\u00a0
the actual
\u00a0
tax loss of
\u00a0
NOK 9.3
\u00a0
billion
\u00a0
in its tax
\u00a0
return. During
2017 and 2018 Telenor ASA received draft notices
\u00a0
of possible reassessment, and Telenor has disclosed
\u00a0
an uncertain tax position in its Annual
Reports since
\u00a0
2016. On
\u00a0
22 August
\u00a0
2019, Telenor
\u00a0
ASA received
\u00a0
a reassessment
\u00a0
order related
\u00a0
to income
\u00a0
year 2013,
\u00a0
disallowing
\u00a0
deduction
\u00a0
for the loss
Telenor ASA recognised in 2012. Following this
\u00a0
reassessment, Telenor ASA recognised a tax expense
\u00a0
of NOK 2.5 billion in the third quarter
\u00a0
2019 and
paid the amount on 3 October 2019.
\u00a0
Telenor ASA disagrees with the tax authorities\u2019 position
\u00a0
and appealed the reassessment. In a decision
\u00a0
received
10 February
\u00a0
2021 the Tax
\u00a0
Appeal Board
\u00a0
upheld the
\u00a0
reassessment.
\u00a0
Telenor
\u00a0
ASA appealed
\u00a0
the decision
\u00a0
to the district
\u00a0
court. On
\u00a0
28 March 2022,
\u00a0
the
district court decided in favour of Telenor ASA,
\u00a0
and the tax expense was reversed with
\u00a0
NOK 2.5 billion in 2022. The government has appealed
\u00a0
the
ruling to the Court of Appeal, and the
\u00a0
appeal is scheduled to be heard in April
\u00a0
2023.
Tax effect of
\u00a0
temporary differences
\u00a0
and tax losses
\u00a0
carried forward
\u00a0
as of 31 December
2022
2021
NOK in millions
Deferred
tax assets
Deferred tax
liabilities
Of which
deferred
not recognised
the income
statement
Deferred
tax assets
Deferred tax
liabilities
Of which
recognised
the income
statement
Tangible and intangible assets
1 791
(9 269)
( 142)
575
1 861
(11 885)
( 80)
618
Undistributed earnings in foreign subsidiaries
and associated
\u00a0
companies
-
( 207)
-
128
-
( 344)
-
106
Non-current borrowings
4 364
( 262)
-
524
4 920
( 169)
-
( 722)
Other non-current
\u00a0
items
761
( 994)
-
( 48)
1 262
(1 307)
-
121
Total non-current assets and liabilities
6 915
(10 733)
( 142)
1 180
8 043
(13 706)
( 80)
124
Total current
\u00a0
assets and
\u00a0
liabilities
2 532
( 204)
-
117
2 884
( 288)
-
955
Tax losses carried forward
3 757
-
( 229)
2 088
1 184
-
( 216)
( 241)
Valuation allowance recognised
\u00a0
in the income
\u00a0
statement
\u00a0
( 59)
17
Deferred tax recognised in the income
statement
3 325
855
Total deferred tax assets/liabilities
13 205
(10 937)
( 371)
12 111
(13 994)
( 296)
Net deferred tax assets/liabilities
-
1 897
-
-
(2 179)
-
Of which
\u00a0
deferred
\u00a0
tax assets
-
5 536
-
-
2 195
-
Of which deferred tax liabilities
-
(3 639)
-
-
(4 374)
-
For 2022,
\u00a0
total non-current
\u00a0
assets and
\u00a0
liabilities
\u00a0
decreased
\u00a0
by NOK 1.1
\u00a0
billion, and
\u00a0
NOK 3.0
\u00a0
billion respectively.
\u00a0
Out of those,
\u00a0
NOK 1.1
\u00a0
billion, and
\u00a0
NOK
2.4 billion respectively are related to the deconsolidation
\u00a0
of Digi. Total current assets decreased by NOK 0.7
\u00a0
billion for the same reason. For 2021,
the decrease
\u00a0
in deferred
\u00a0
tax assets
\u00a0
is mainly
\u00a0
related to
\u00a0
the reclassification
\u00a0
of Telenor
\u00a0
Myanmar
\u00a0
as discontinued
\u00a0
operations.
\u00a0
See also
\u00a0
note 12
\u00a0
Held
for sale and discontinued operations.
Changes in net
\u00a0
deferred tax
\u00a0
assets and liabilities
NOK in millions
2022
2021
As of 1 January
(2 179)
(1 990)
Recognised in the income statement
\u00a0
3 325
855
Recognised
\u00a0
in other
\u00a0
comprehensive
\u00a0
income
170
( 592)
Recognised directly to equity
( 11)
( 14)
Acquisitions and disposals of subsidiaries
644
9
Translation differences on deferred taxes
( 51)
64
Discontinued
\u00a0
operations
-
( 511)
As of 31 December
1 897
(2 179)
Recognised in the income statement
For 2022, the change of the amount
\u00a0
recognised in the income statement between 2022
\u00a0
and 2021 is related mainly to Norway and
\u00a0
Pakistan.
\u00a0
Recognised in other comprehensive income
For 2022,
\u00a0
the change
\u00a0
of the amount
\u00a0
recognised
\u00a0
in other
\u00a0
comprehensive
\u00a0
income between
\u00a0
2022 and
\u00a0
2021 is related
\u00a0
to losses
\u00a0
on net investment
hedges.
Acquisitions and disposals of subsidiaries
For 2022, the change of the amount
\u00a0
in acquisitions and disposals between 2022 and
\u00a0
2021 is related to the deconsolidation of Digi,
\u00a0
see note 12 Held
for sale
\u00a0
and discontinued
\u00a0
operations.
.
NOTE 11
Earnings per share and dividends
The earnings per share (EPS) of NOK 32.09 in 2022 was
\u00a0
significantly impacted by the gain from the merger
between Digi and Celcom, see further information in note 12. The
\u00a0
EPS from continuing operations was NOK 7.85 in
2022 compared to NOK 4.04 in 2021. The dividend policy in Telenor
\u00a0
is to aim for a year-on-year growth in nominal
dividend per share.
\u00a0
The annual dividends are normally paid in two instalments.
\u00a0
The Board of Directors has
proposed a dividend of NOK 9.40 per share for 2022.
\u00a0
Accounting policies
Earnings per share (EPS) is the amount of
\u00a0
profit generated for the financial year attributable
\u00a0
to equity shareholders divided by the weighted
average ordinary outstanding shares.
The calculations
\u00a0
of earnings
\u00a0
per share
\u00a0
attributable
\u00a0
to the ordinary
\u00a0
equity holders
\u00a0
of Telenor
\u00a0
ASA are
\u00a0
based on the
\u00a0
following
\u00a0
net income
\u00a0
and share
data:
Net income to equity holders of Telenor ASA
NOK in millions
2022
2021
Net income
\u00a0
from continuing
\u00a0
operations
10 980
5 651
Net income
\u00a0
(loss) from
\u00a0
discontinued
\u00a0
operations
33 932
(4 123)
Net income
\u00a0
from total
\u00a0
operations
44 913
1 528
Number of shares
In thousands
2022
2021
Weighted
\u00a0
average number
\u00a0
of shares
\u00a0
for the purpose
\u00a0
of basic
\u00a0
earnings
\u00a0
per share
1 399 458
1 399 458
Basic/Diluted earnings per share
NOK
2022
2021
Basic/Diluted earnings per share from continuing operations
7.85
4.04
Basic/Diluted earnings per share from discontinued operations
24.25
(2.95)
Basic/Diluted earnings per share for total operations
32.09
1.09
2022
2021
Ordinary
\u00a0
dividend
\u00a0
per share
\u00a0
in NOK \u2013 paid
9.30
9.00
Ordinary
\u00a0
dividend
\u00a0
per share
\u00a0
in NOK - proposed
\u00a0
by the Board
\u00a0
of Directors
9.40
9.30
Total dividend of NOK 13.0 billion has
\u00a0
been paid and charged to equity in
\u00a0
2022 (NOK 12.6 billion in 2021).
\u00a0
In respect of 2022, the Board of
\u00a0
Directors proposed an ordinary dividend of NOK
9.40
, to be resolved by the Annual General
\u00a0
Meeting on 10 May
2023. The
\u00a0
total amount
\u00a0
of dividend
\u00a0
is estimated
\u00a0
to be NOK
\u00a0
13.2 billion
\u00a0
based on
\u00a0
the outstanding
\u00a0
number of
\u00a0
shares as
\u00a0
of 31 December
\u00a0
2022. The
dividend
\u00a0
will be split
\u00a0
into two
\u00a0
tranches of
\u00a0
NOK 5.00
\u00a0
and NOK 4.40
\u00a0
per share
\u00a0
to be paid
\u00a0
out in May
\u00a0
2023
\u00a0
and October
\u00a0
2023, respectively.
Paid ordinary dividends per share was NOK
9.30
9.00
Dividends paid
\u00a0
to non-controlling
\u00a0
interests
\u00a0
During 2022,
\u00a0
dividends
\u00a0
paid to non-controlling
\u00a0
interests
\u00a0
in subsidiaries
\u00a0
amounted
\u00a0
to NOK 3.6
\u00a0
billion
\u00a0
(NOK 1.2
\u00a0
billion in
\u00a0
Digi, NOK
\u00a0
1.6 billion
\u00a0
in
Grameenphone and NOK 0.7 billion in dtac).
\u00a0
During 2021,
\u00a0
dividends
\u00a0
paid to non-controlling
\u00a0
interests
\u00a0
in subsidiaries
\u00a0
amounted to
\u00a0
NOK 3.2
\u00a0
billion (NOK
\u00a0
1.5 billion
\u00a0
in Digi,
\u00a0
NOK 1.1 billion
\u00a0
in
Grameenphone and NOK 0.6 billion in dtac).
NOTE 12
Held for sale and discontinued operations
In 2022, the merger between Digi and Celcom in Malaysia took place
\u00a0
and Telenor got diluted and Digi was
deconsolidated as a subsidiary. For historical periods Digi has been
\u00a0
re-presented as discontinued operations.
\u00a0
After
the transaction, Telenor owns 33.1 percent of Digi which is presented
\u00a0
as an associated company of Telenor, see
note 35. Other entities presented as held for sale and discontinued
\u00a0
operations include Myanmar which was sold in
March 2022 and Telenor India, which was disposed in 2018.
Accounting policies
\u00a0
Non-current
\u00a0
assets and
\u00a0
disposal
\u00a0
groups are
\u00a0
classified
\u00a0
as held for
\u00a0
sale if their
\u00a0
carrying
\u00a0
amounts will
\u00a0
be recovered
\u00a0
principally
\u00a0
through sale
\u00a0
rather than
continuing
\u00a0
use. This
\u00a0
also applies
\u00a0
for situations
\u00a0
where the
\u00a0
Group continues
\u00a0
its operations
\u00a0
but loses
\u00a0
control over
\u00a0
the operation.
\u00a0
Non-current
\u00a0
assets
and disposal
\u00a0
groups classified
\u00a0
as held for
\u00a0
sale are
\u00a0
measured
\u00a0
at the lower
\u00a0
of their
\u00a0
carrying
\u00a0
amount and
\u00a0
fair value
\u00a0
less cost
\u00a0
to sell and
\u00a0
presented
separately
\u00a0
as assets
\u00a0
held for
\u00a0
sale and
\u00a0
liabilities
\u00a0
held for
\u00a0
sale in the
\u00a0
statement
\u00a0
of financial
\u00a0
position.
The criteria
\u00a0
for held
\u00a0
for sale classification
\u00a0
is regarded
\u00a0
as met only
\u00a0
when the sale
\u00a0
is highly
\u00a0
probable,
\u00a0
and the asset
\u00a0
or disposal
\u00a0
group is
\u00a0
available
\u00a0
for
immediate sale in its present condition. Actions required
\u00a0
to complete the sale should indicate that
\u00a0
it is unlikely that significant changes to the plan
will be
\u00a0
made or
\u00a0
that the plan
\u00a0
to sell will
\u00a0
be withdrawn.
\u00a0
In addition,
\u00a0
management
\u00a0
must be committed
\u00a0
to the plan,
\u00a0
and must
\u00a0
be expected
\u00a0
that the sale
will be completed within a year.
Property,
\u00a0
plant and
\u00a0
equipment
\u00a0
and intangible
\u00a0
assets are
\u00a0
not depreciated
\u00a0
or amortised
\u00a0
once classified
\u00a0
as held
\u00a0
for sale.
\u00a0
The equity
\u00a0
method is
discontinued
\u00a0
for associated
\u00a0
companies
\u00a0
classified
\u00a0
as held for
\u00a0
sale.
A disposal group qualifies as discontinued operation if
\u00a0
it is a cash generating unit that
\u00a0
has either been disposed of, or is
\u00a0
classified as held for sale,
and represent
\u00a0
a separate
\u00a0
major line
\u00a0
of business
\u00a0
or geographical
\u00a0
area of operations.
\u00a0
Discontinued
\u00a0
operations
\u00a0
are excluded
\u00a0
from the results
\u00a0
of
continuing
\u00a0
operations
\u00a0
and are
\u00a0
presented
\u00a0
as a single
\u00a0
amount as
\u00a0
profit or
\u00a0
loss after
\u00a0
tax from
\u00a0
discontinued
\u00a0
operations
\u00a0
in the income
\u00a0
statement.
Discontinued operations are also excluded from segment reporting.
\u00a0
All consolidation procedures are still applicable, and
\u00a0
only external revenues
and expenses
\u00a0
are shown
\u00a0
as discontinued
\u00a0
operations.
Discontinued
\u00a0
operations and
\u00a0
assets held for
\u00a0
sale
Digi
On 30 November 2022, the merger of
\u00a0
the telecommunication operations of Celcom and Digi
\u00a0
in Malaysia was completed. The new company is
named CelcomDigi. On completion, Digi issued 3.96 billion
\u00a0
shares to Axiata in addition to a cash
\u00a0
payment of NOK 5.4 billion. The share issue diluted
Telenor\u2019s ownership to 32.47% and Telenor lost
\u00a0
control over Digi and Digi was deconsolidated and
\u00a0
recognised as an associated company as of
\u00a0
30
November
\u00a0
2022. As
\u00a0
part of the
\u00a0
transaction
\u00a0
to bring
\u00a0
Telenor and
\u00a0
Axiata to
\u00a0
equal ownership,
\u00a0
Telenor
\u00a0
acquired
\u00a0
at the same
\u00a0
date 73.4
\u00a0
million shares
from Axiata
\u00a0
for an amount
\u00a0
of NOK 667
\u00a0
million. Telenor\u2019s
\u00a0
ownership
\u00a0
after the
\u00a0
transaction
\u00a0
is 33.1%
\u00a0
and CelcomDigi
\u00a0
is accounted
\u00a0
for as an
\u00a0
associated
company.
The gain
\u00a0
recognised
\u00a0
on the date
\u00a0
of losing
\u00a0
control over
\u00a0
Digi amounts
\u00a0
to NOK 32.7
\u00a0
billion. The
\u00a0
gain was
\u00a0
based on a
\u00a0
market value
\u00a0
of the combined
entity
\u00a0
as of opening 1 December 2022, which
\u00a0
was NOK 34.1 billion for Telenor\u2019s interest
\u00a0
in the new company CelcomDigi. Due to CelcomDigi
\u00a0
being a
listed company and have not yet published
\u00a0
their fourth quarter 2022 result, the gain is
\u00a0
combined with the net income from Digi for
\u00a0
the period
October and
\u00a0
November
\u00a0
2022. A
\u00a0
gain of NOK
\u00a0
450 million
\u00a0
related to
\u00a0
cumulative
\u00a0
translation
\u00a0
differences
\u00a0
and a loss
\u00a0
of NOK 233
\u00a0
million related
\u00a0
to net
investment hedge items, previously recognised in other comprehensive
\u00a0
income, have been reclassified and included in
\u00a0
the gain calculation. The
success fee
\u00a0
to advisors
\u00a0
of NOK 155
\u00a0
million has
\u00a0
been included
\u00a0
in the gain
\u00a0
calculation.
Prior to closing of the transaction, Digi
\u00a0
obtained funds through external borrowings to finance the
\u00a0
cash payment to Axiata. This is reflected as
\u00a0
a
significant cash inflow in Telenor\u2019s consolidated cash flow
\u00a0
as financing activities. As Telenor lost control
\u00a0
in Digi, the cash balance is derecognised
under investing activities in the cash flow
\u00a0
statement. The derecognised cash balance of NOK
\u00a0
6.4 billion includes the funding for payment to
\u00a0
Axiata
The historical profit (loss) for Digi presented as
\u00a0
discontinued operation are as follows:
NOK in millions
2022
2021
Revenue
12 362
13 088
EBITDA
6 026
6 473
EBIT
3 586
3 851
Profit (loss) before tax
3 136
3 361
Income taxes
(1 004)
( 731)
Profit (loss) after tax
2 132
2 630
Gain (loss)
\u00a0
on disposal
\u00a0
after tax
32 652
-
Profit (loss) from discontinued operations - attributable to equity holders
\u00a0
of Telenor ASA
34 784
2 630
On 8 July
\u00a0
2021, Telenor
\u00a0
Group entered
\u00a0
into an agreement
\u00a0
with M1 Group
\u00a0
to sell
its mobile
\u00a0
operations
a total
consideration of USD 105 million (approximately NOK
\u00a0
920 million), of which USD 55 million
\u00a0
(approximately NOK 480 million) as deferred payment
The transaction corresponded
\u00a0
to an implied enterprise value of approximately
\u00a0
USD 600 million (approximately NOK
\u00a0
5.2 billion). On
25 March 2022, Telenor completed the sale of
\u00a0
Telenor Myanmar following the regulatory approval given
\u00a0
17 March 2022. In line with the sales
\u00a0
and
purchase
\u00a0
agreement,
\u00a0
Telenor
\u00a0
received
\u00a0
USD 50 million
\u00a0
(NOK 0.5
\u00a0
billion) at
\u00a0
closing and
\u00a0
paid USD
\u00a0
4 million as
\u00a0
transaction
\u00a0
cost. In
\u00a0
the third
\u00a0
quarter
2022 Telenor
\u00a0
received
\u00a0
USD 28 million
\u00a0
(NOK 0.3
\u00a0
billion)
\u00a0
from M1 Group
\u00a0
as a final
\u00a0
settlement
\u00a0
of the transaction,
\u00a0
which represented
\u00a0
the present
\u00a0
value
of the remaining USD 55 million deferred
\u00a0
payment. The received deferred payment was recognised in the third
\u00a0
quarter of 2022. The transaction has
impacted the equity of Telenor Group positively with
\u00a0
NOK 0.2 billion. However, the reclassification of
\u00a0
accumulated losses related to translation
differences earlier recognised in other comprehensive income
\u00a0
impacted the income statement negatively with approximately
\u00a0
NOK 0.8 billion,
resulted in a net loss on disposal
\u00a0
of NOK 0.6 billion. The derecognition of the
\u00a0
cash balance in Telenor Myanmar and the total
\u00a0
proceeds received have
resulted
\u00a0
in a net
\u00a0
negative
\u00a0
cash flow
\u00a0
impact of
\u00a0
around NOK
\u00a0
1.4 billion
\u00a0
in 2022.
Telenor Myanmar was with effect from the second
\u00a0
quarter 2021 presented as assets held for
\u00a0
sale and discontinued operations.
The profit (loss) for Telenor Myanmar presented
\u00a0
as discontinued operation are as follows:
NOK in millions
2022
2021
Revenue
1 018
4 835
EBITDA
617
2 751
EBIT
617
(5 743)
Profit (loss) before tax
602
(6 185)
Income taxes
( 50)
( 53)
Profit (loss) after tax
553
(6 238)
Gain (loss)
\u00a0
on disposal
\u00a0
after tax
( 589)
-
Profit (loss) from discontinued operations - attributable to equity holders
\u00a0
of Telenor ASA
( 36)
(6 238)
Telenor India
On 23 February 2017, the Group entered
\u00a0
into an agreement with Bharti Airtel Limited (Airtel),
\u00a0
whereby Airtel would take full ownership of Telenor
India. The transaction was completed 14 May
\u00a0
2018. The exposure to claims related to
\u00a0
the period Telenor owned the business remains
\u00a0
with Telenor.
A guarantee to Airtel was recognised at
\u00a0
fair value as of closing date of the transaction,
\u00a0
and subsequent changes to the estimate are
\u00a0
recognised on
the discontinued
\u00a0
operations
\u00a0
line in the
\u00a0
income statement.
\u00a0
During 2022,
\u00a0
an additional
\u00a0
provision
\u00a0
of NOK 0.9
\u00a0
billion plus
\u00a0
interests was
\u00a0
recognised
following reassessment of the demand from Department
\u00a0
of Telecommunication (DoT). See note 23 for further information
\u00a0
regarding the disputed
amount and
\u00a0
note 40
\u00a0
for payments
\u00a0
made after
\u00a0
31 December
\u00a0
2022.
Summary all disposal groups
The profit (loss) of all disposal groups including
\u00a0
Digi and Telenor Myanmar presented as discontinued
\u00a0
operations until disposal, and subsequent
adjustments:
NOK in millions
2022
2021
Revenue
13 380
17 923
EBITDA
6 643
9 223
EBIT
4 203
(1 892)
Profit (loss) before tax
3 738
(2 823)
Income taxes
(1 054)
( 785)
Profit (loss) after tax
2 684
(3 608)
Gain (loss)
\u00a0
on disposal
\u00a0
after tax
31 248
( 515)
Profit (loss) from discontinued operations - attributable to equity holders
\u00a0
of Telenor ASA
33 932
(4 123)
The gain on disposal recognised during 2022
\u00a0
are mainly related to Digi which is offset
\u00a0
by additional provision and accrual of interest on
\u00a0
existing
Adjusted Gross Revenue (AGR) provision against demand
\u00a0
from Department of Telecommunication (DoT) in India
\u00a0
and losses from Telenor Myanmar.
The losses on disposal recognised during 2021
\u00a0
was mainly related to Telenor India.
\u00a0
Cashflow related to discontinued operations presented below
\u00a0
are from external transactions. Hence, the cash flows
\u00a0
for discontinued operations do
not reflect
\u00a0
these operations
\u00a0
as if they
\u00a0
were standalone
\u00a0
entities.
NOK in millions
2022
2021
Digi
Myanmar
Total
Digi
Myanmar
Total
Net cash flow
\u00a0
from operating
\u00a0
activities
5 451
612
6 063
5 557
2 574
8 130
Net cash flow from investing activities
(7 802)
(2 122)
(9 925)
(1 465)
( 256)
(1 721)
Net cash flow
\u00a0
from financing
\u00a0
activities
2 922
( 186)
2 736
(2 912)
( 981)
(3 893)
Total cash flows from discontinued operations
570
(1 697)
(1 126)
1 179
1 337
2 516
Effects of
\u00a0
exchange
\u00a0
rate changes
\u00a0
on cash and
\u00a0
cash equivalents
38
1
38
23
( 229)
( 207)
Net cash flows from discontinued operations
608
(1 696)
(1 088)
1 201
1 108
2 309
The major
\u00a0
classes of
\u00a0
liabilities
\u00a0
of the disposal
\u00a0
groups classified
\u00a0
as held
\u00a0
for sale as
\u00a0
of 31 December
\u00a0
2022 represents
\u00a0
Telenor
\u00a0
India with
\u00a0
a provision
\u00a0
of
NOK 4.7 billion.
\u00a0
As of 31
\u00a0
December
\u00a0
2021, assets
\u00a0
held for
\u00a0
sale of NOK
\u00a0
2.2 billion
\u00a0
relates to
\u00a0
Telenor Myanmar
\u00a0
and remaining
\u00a0
NOK 0.7 billion
\u00a0
relates to
Open Universe. Liabilities held for sale includes NOK 2.1
\u00a0
billion related to Telenor Myanmar and NOK
\u00a0
3.4 billion representing the provision for Telenor
India:
NOK in millions
Assets
Property, plant and equipment
-
717
Inventory
-
13
Trade and other receivables
-
317
Cash and
\u00a0
cash equivalents
-
1 863
Total assets classified as held for sale
-
2 910
Liabilities
Non-current liabilities
-
23
Current liabilities
4 735
5 557
Total liabilities
\u00a0
held for
\u00a0
sale
4 735
5 580
Accumulated
\u00a0
amounts recognised
\u00a0
in Other
\u00a0
comprehensive
\u00a0
income
The accumulated amounts for discontinued operations recognised
\u00a0
in Other comprehensive income within Equity are
\u00a0
as follows:
NOK in millions
2022
2021
Digi
-
361
Telenor Myanmar
-
( 802)
Telenor India
( 652)
( 180)
( 652)
( 621)
NOTE 13
Cash flow information
This note summarises
\u00a0
the most significant
\u00a0
cash inflows and
\u00a0
outflows during
\u00a0
the year, including
\u00a0
significant
investments
\u00a0
and disposals
\u00a0
in addition
\u00a0
to payments of
\u00a0
interest-bearing
\u00a0
liabilities
\u00a0
and leasing liabilities.
Accounting policies
Telenor presents the statement of cash flows
\u00a0
using the indirect method. Cash inflows and
\u00a0
outflows are shown separately for investing and
financing activities, while operating activities include both cash
\u00a0
and non-cash line items. Interest received and paid,
\u00a0
and dividends received, are
reported as a part
\u00a0
of operating activities. Dividends distributed by Telenor
\u00a0
ASA and subsidiaries with non-controlling interests are included
\u00a0
as a
part of financing
\u00a0
activities.
\u00a0
Value-added
\u00a0
tax (VAT)
\u00a0
and other
\u00a0
similar taxes
\u00a0
are regarded
\u00a0
as collection
\u00a0
of tax on
\u00a0
behalf of
\u00a0
authorities
\u00a0
and are
\u00a0
reported
net. Discontinued
\u00a0
operations
\u00a0
are included
\u00a0
in the cash
\u00a0
flow statement
\u00a0
and information
\u00a0
about operating,
\u00a0
financing,
\u00a0
investing
\u00a0
cash flows
\u00a0
from
discontinued
\u00a0
operations
\u00a0
is shown
\u00a0
in note 12.
Changes in net
\u00a0
operating working
\u00a0
capital
Changes in net operating working capital include changes in accounts
\u00a0
receivable and accounts payable related to operating activities, and
inventory.
NOK in millions
2022
2021
Inventory
( 186)
( 319)
Trade and other receivables
(1 377)
392
Trade and
\u00a0
other payables
174
831
Changes in
\u00a0
net operating
\u00a0
working
\u00a0
capital
(1 389)
905
Property, plant
\u00a0
and equipment
\u00a0
and intangible
\u00a0
assets reconciliation
\u00a0
of additions
\u00a0
and purchases
NOK in millions
2022
2021
Additions to property, plant and equipment and (see note 17)
(13 789)
(14 888)
Additions to intangible assets (see note 15)
(3 092)
(2 816)
Additions to right-of-use assets (see note
\u00a0
16)
(9 963)
(9 015)
Capital expenses incurred as part of assets held
\u00a0
for sale
(1 203)
( 127)
8 871
5 704
Change in
\u00a0
estimates
\u00a0
for ARO obligations
( 856)
( 339)
Changes in accounts payable and prepayments
( 510)
1 985
Other Adjustments
1 244
50
Purchases of property plant and equipment and intangible assets (cash
\u00a0
flow from investing activities)
(19 298)
(19 447)
Cash payments at or before lease commencement date
\u00a0
are classified as cash outflows from investing
\u00a0
activities. Subsequent payments during the
lease term are classified as cash outflows from
\u00a0
financing activities.
During 2022,
\u00a0
the recognised
\u00a0
lease liabilities
\u00a0
of NOK 8.9
\u00a0
billion represent
\u00a0
the deferred
\u00a0
payments
\u00a0
of total
\u00a0
additions
\u00a0
in right-of-use
\u00a0
assets of
\u00a0
NOK 10.0
billion, NOK 1.1 billion was paid at
\u00a0
or before lease commencement date mainly relating
\u00a0
to spectrum licences in Grameenphone, Pakistan and
Norway, which is classified as cash outflow
\u00a0
from investing activities. See note 16 for
\u00a0
more information related to leases.
During 2021,
\u00a0
the recognised
\u00a0
lease liabilities
\u00a0
of NOK 5.7
\u00a0
billion represent
\u00a0
the deferred
\u00a0
payments
\u00a0
of total
\u00a0
additions
\u00a0
in right-of-use
\u00a0
assets of
\u00a0
NOK 9.0
billion, NOK 3.3 billion was paid at or
\u00a0
before lease commencement date mainly relating to
\u00a0
spectrum licences in Pakistan (NOK 2.2 billion),
Grameenphone
\u00a0
and Sweden, which is classified as cash
\u00a0
outflow from investing activities.
\u00a0
See note 16 for more information related to
\u00a0
leases.
Changes in accounts payable and prepayments in 2022 are
\u00a0
mainly related to change in capex related payables in Dtac
\u00a0
and Grameenphone.
Changes in accounts payable and prepayments in 2021
\u00a0
are mainly due to reclassification from prepaid capex
\u00a0
to right-of-use licences in
\u00a0
Pakistan.
\u00a0
Acquisitions
\u00a0
and disposals
\u00a0
of subsidiaries,
\u00a0
associated companies
\u00a0
and joint ventures
The table below shows the effects on
\u00a0
the consolidated statement of financial position from
\u00a0
disposals of subsidiaries, associated companies, and
joint ventures.
NOK in millions
2022
2021
Disposals of subsidiaries, associated companies, and joint ventures
Associated
\u00a0
companies
\u00a0
and joint
\u00a0
ventures (refer
\u00a0
to note 35)
432
( 3)
Other non-current
\u00a0
assets
15 302
12
Current assets
12 580
-
Liabilities
(24 144)
( 1)
Gains (losses)
\u00a0
adjusted
\u00a0
for translation
\u00a0
differences
\u00a0
on disposals
1)
34 339
( 174)
Sales price
37 916
( 166)
(34 116)
182
Proceeds
\u00a0
received
\u00a0
as sale
\u00a0
consideration
3 798
17
Cash in subsidiaries
\u00a0
disposed
\u00a0
of
(8 460)
-
Proceeds from disposal of subsidiaries and associated companies net of cash
\u00a0
disposed of
(4 662)
17
1)
In 2022 adjusted for NOK 0.6 billion relating to
\u00a0
reclassification of translation differences from other
\u00a0
comprehensive income to the income statement (see
\u00a0
note
28) the total gain of NOK 34.3 billion mainly
\u00a0
relates to deconsolidation of Digi and recognition as
\u00a0
an associate, sale of Telenor Myanmar and disposal
\u00a0
of fixed
non-core assets in Sweden (see note 28, 35 and
\u00a0
12). In 2021, there are no actual disposals, the
\u00a0
effects are mainly related to adjustments to disposals
\u00a0
made in
2020.
During 2022,
\u00a0
disposals
\u00a0
of associated
\u00a0
companies
\u00a0
and joint
\u00a0
ventures
\u00a0
were mainly
\u00a0
related to
\u00a0
disposal
\u00a0
of the associated
\u00a0
company Wave
\u00a0
Money,
\u00a0
see
note 35.
During 2022, disposals of subsidiaries were mainly
\u00a0
related to deconsolidation of Digi and recognition as
\u00a0
an associate, sale of Telenor Myanmar and
disposal of fixed non-core assets in
\u00a0
Sweden.
\u00a0
During 2021, disposals of subsidiaries were mainly related to
\u00a0
disposal of development properties.
The table below shows the effects on
\u00a0
the consolidated statement of financial position from
\u00a0
acquisition of subsidiaries, associated companies, and
joint ventures.
NOK in millions
2022
2021
Purchases of subsidiaries associated companies, and joint ventures
Investments
\u00a0
in associated
\u00a0
companies
\u00a0
and joint
\u00a0
ventures
35 089
393
Total purchase price and capital injections
35 089
393
(34 098)
( 5)
Cash payments
\u00a0
related
\u00a0
to acquisitions
( 991)
( 391)
Purchases of subsidiaries associated companies and joint ventures net of cash
\u00a0
acquired
( 991)
( 391)
During 2022, investments in associated companies and
\u00a0
joint ventures are mainly related to deconsolidation of
\u00a0
Digi and recognition as an associate,
Telenor\u2019s acquisition of 73.4 million shares from
\u00a0
Axiata and capital injection in Telenor Microfinance
\u00a0
Bank Limited (TMB), see note 35.
\u00a0
During 2021, investments in associated companies and
\u00a0
joint ventures are mainly related to capital injection
\u00a0
in Telenor Microfinance Bank Limited
Reconciliation
\u00a0
of interest bearing
\u00a0
liabilities
NOK in millions
2022
2021
Interest-
bearing
liabilities
Lease liabilities
Total
Interest-
bearing
liabilities
Lease liabilities
Total
Balance as of 1 January
97 087
35 077
132 164
105 923
44 882
150 805
Cash flow
\u00a0
from Financing
\u00a0
activities
Proceeds
\u00a0
from borrowings
20 956
-
20 956
26 470
-
26 470
Repayments
\u00a0
of borrowings
(21 044)
-
(21 044)
(29 399)
-
(29 399)
Payments
\u00a0
of lease
\u00a0
liabilities
\u00a0
related to
\u00a0
spectrum
\u00a0
licences
-
(2 483)
(2 483)
-
(2 871)
(2 871)
Payments
\u00a0
of lease
\u00a0
liabilities
\u00a0
related to
\u00a0
other lease
\u00a0
contracts
-
(5 589)
(5 589)
-
(5 955)
(5 955)
Net cash flow from financing activities
( 88)
(8 072)
(8 159)
(2 930)
(8 826)
(11 756)
Change due
\u00a0
to hedge
\u00a0
accounting
( 585)
-
( 585)
(1 160)
-
(1 160)
Effects from
\u00a0
exchange
\u00a0
rate fluctuations
5 138
744
5 882
(4 915)
(2 227)
(7 142)
Net interest
\u00a0
paid/accrued
205
277
483
( 10)
353
343
Acquisitions
-
-
-
-
-
-
Disposals
(10 490)
(5 359)
(15 849)
( 22)
-
( 22)
-
8 871
8 871
-
5 704
5 704
Termination
\u00a0
and reassessment
\u00a0
of lease
\u00a0
contracts
-
( 589)
( 589)
-
(4 076)
(4 076)
Classified as liabilities held for sale
-
-
-
-
( 733)
( 733)
Other
627
141
767
201
-
201
Other changes
(5 106)
4 085
(1 020)
(5 906)
( 979)
(6 885)
Balance as of 31 December
91 893
31 091
122 984
97 086
35 077
132 164
Non-current liabilities
82 724
24 417
107 141
87 811
28 101
115 911
Current liabilities
9 169
6 674
15 843
9 276
6 977
16 253
Cash flow from financing activities consists of
\u00a0
proceeds from and repayments of borrowings, including
\u00a0
repayments of principal portion of lease
liabilities.
\u00a0
Net cash outflow
\u00a0
from financing
\u00a0
activities
\u00a0
excluding
\u00a0
repayments
\u00a0
of lease
\u00a0
liabilities
\u00a0
amounted
\u00a0
to NOK 0.1
\u00a0
billion in
\u00a0
2022 compared
\u00a0
to NOK
2.9 billion in 2021, mainly explained by
\u00a0
no bond issuances under the EMTN program
\u00a0
in 2022 (see note 30).
Cash payments
\u00a0
related to lease
\u00a0
contracts
NOK in millions
Classification
\u00a0
in cash flow
\u00a0
statement
2022
2021
Payments
\u00a0
of lease
\u00a0
liabilities
\u00a0
\u2013 principal
\u00a0
portion
Financing activities
8 072
8 826
Payments of lease liabilities \u2013 interest portion
Operating activities
1 060
1 029
Payments
\u00a0
of variable,
\u00a0
short term
\u00a0
and low
\u00a0
value leases
Operating activities
3 074
3 540
Prepayments
\u00a0
made at
\u00a0
or before
\u00a0
lease commencement
Investing
\u00a0
activities
803
1 202
Total cash outflow
13 009
14 597
Repayments
\u00a0
of the principal
\u00a0
portion related
\u00a0
to total
\u00a0
lease liabilities
\u00a0
in 2022
\u00a0
of NOK 8.1
\u00a0
billion (NOK
\u00a0
8.8 billion
\u00a0
in 2021)
\u00a0
include instalment
\u00a0
payment of
spectrum
\u00a0
licences
\u00a0
of NOK 2.5
\u00a0
billion (NOK
\u00a0
2.9 billion
\u00a0
in 2021) and
\u00a0
repayments
\u00a0
of other leases
\u00a0
of NOK 5.6
\u00a0
billion (NOK
\u00a0
6.0 billion
\u00a0
in 2021).
\u00a0
The
instalment payments of spectrum licences in 2022 and
\u00a0
2021 were mainly in dtac, Norway and Pakistan.
\u00a0
Lease payments related to other lease
contracts were mainly in dtac, Sweden, Digi, Pakistan
\u00a0
and Grameenphone in 2022 whereas in 2021 it was
\u00a0
mainly in dtac, Sweden, Digi, Myanmar,
Pakistan.
Repayments
\u00a0
of the interest
\u00a0
portion of
\u00a0
total lease
\u00a0
liabilities
\u00a0
in 2022
\u00a0
of NOK 1.1
\u00a0
billion include
\u00a0
repayments
\u00a0
of interest
\u00a0
related to
\u00a0
spectrum
\u00a0
licences
\u00a0
of
NOK 0.4
\u00a0
billion (NOK
\u00a0
0.3 billion
\u00a0
in 2021)
\u00a0
and repayments
\u00a0
of interest
\u00a0
related
\u00a0
to other lease
\u00a0
contracts
\u00a0
of NOK 0.7
\u00a0
billion (NOK
\u00a0
0.7 billion
\u00a0
in 2021).
Payments
\u00a0
of variable,
\u00a0
short term
\u00a0
and low
\u00a0
value leases
\u00a0
of NOK 3.1
\u00a0
billion include
\u00a0
variable lease
\u00a0
payments of
\u00a0
NOK 3.0
\u00a0
billion
\u00a0
and payments
\u00a0
of short
term and low value leases of NOK 0.2
\u00a0
billion.
\u00a0
Prepayments
\u00a0
of investing
\u00a0
activities
\u00a0
of NOK 0.8
\u00a0
billion
\u00a0
in 2022
\u00a0
mainly related
\u00a0
to payments
\u00a0
made at
\u00a0
or before
\u00a0
acquisition
\u00a0
of spectrum
\u00a0
licences
\u00a0
of NOK
0.3 billion in Norway for the bands of
\u00a0
2500-2690 MHz and 3400-3800 MHz and NOK 0.3
\u00a0
billion in Grameenphone for the bands 2.6
\u00a0
GHz.
NOTE 14
Goodwill
Goodwill relates to excess values that has not been allocated
\u00a0
to other assets in business combinations.
\u00a0
Goodwill
typically represents the value of synergies, employees and other assets
\u00a0
that do not qualify for recognition as
separate identifiable assets according to IFRS. Goodwill is not amortised
\u00a0
but tested for impairment together with
other assets in cash-generating units, refer to note 18 for further
\u00a0
information about impairment of assets.
\u00a0
Accounting policies
Goodwill
\u00a0
arises in business combinations as the difference
\u00a0
between the consideration and the acquired business\u2019
\u00a0
identifiable assets and assumed
liabilities at the acquisition date. Assets and
\u00a0
liabilities are generally recognised at fair value, except for
\u00a0
non-current assets classified as held for sale
and deferred
\u00a0
taxes which
\u00a0
are recognised
\u00a0
at nominal
\u00a0
value. The
\u00a0
fair value
\u00a0
of any previously
\u00a0
held equity
\u00a0
interests
\u00a0
and the amount
\u00a0
of any non-
controlling interest is also included when determining the
\u00a0
amount of goodwill.
Key judgments
\u00a0
and estimates
The fair value assessment of assets and
\u00a0
liabilities in a business combination usually include
\u00a0
significant judgments and estimates, as valuation
techniques can include assumptions on future revenues,
\u00a0
net income, outcome of legal claims and
\u00a0
many other variables. Telenor always use
external
\u00a0
valuation
\u00a0
experts to
\u00a0
assess the
\u00a0
fair value
\u00a0
of assets
\u00a0
and liabilities
\u00a0
in significant
\u00a0
business combinations.
\u00a0
Further,
\u00a0
the impairment
\u00a0
testing of
goodwill
\u00a0
includes
\u00a0
a variety
\u00a0
of key judgments
\u00a0
and estimates
\u00a0
made by
\u00a0
management.
\u00a0
See further
\u00a0
description
\u00a0
in note 18
\u00a0
Impairment.
Origination
\u00a0
of goodwill
The table below illustrates where the goodwill
\u00a0
has originated and the development in carrying amounts.
NOK in millions
Telenor
Sweden
dtac
Thailand
DNA
Finland
Other
1)
Sum
As of 1 January 2021
6 771
3 572
17 401
1 504
29 248
Translations differences
( 455)
( 249)
( 807)
( 7)
(1 518)
As of 31 December 2021
6 317
3 323
16 594
1 497
27 730
Translations differences
( 187)
241
901
4
958
Derecognised on disposal of subsidiaries
( 475)
-
-
( 604)
(1 079)
As of 31 December 2022
5 655
3 564
17 495
896
27 609
Accumulated impairment
As of 1 January 2021
( 278)
-
-
( 24)
( 301)
Translations differences
19
-
-
-
19
As of 31 December 2021
( 259)
-
-
( 24)
( 283)
Translations differences
8
-
-
-
8
As of 31 December 2022
( 251)
-
-
( 24)
( 275)
Carrying amount
As of 31 December 2022
5 403
3 564
17 495
873
27 335
As of 31 December 2021
6 057
3 323
16 594
1 473
27 448
1)
Other includes primarily Digi (Malaysia) and Telenor
\u00a0
Norway.
NOTE 15
Intangible assets
A significant part of intangible assets relates to software either acquired
\u00a0
individually, generated internally or
acquired in business combinations. Intangible assets
\u00a0
also include customer bases and trademarks in addition to
other intangible assets.
\u00a0
Accounting policies
\u00a0
Intangible
\u00a0
assets acquired
\u00a0
individually
\u00a0
are measured
\u00a0
initially
\u00a0
at cost and
\u00a0
recognised
\u00a0
as an intangible
\u00a0
assets when
\u00a0
the Group
\u00a0
has control
\u00a0
over the
asset, future
\u00a0
economic
\u00a0
benefits
\u00a0
are expected
\u00a0
to flow to
\u00a0
the Group
\u00a0
and the cost
\u00a0
can be measured
\u00a0
reliably.
\u00a0
The cost
\u00a0
to be capitalised
\u00a0
as part of
\u00a0
the
assets includes direct and incremental costs and,
\u00a0
for qualifying assets, borrowing costs. The cost
\u00a0
of intangible assets acquired in a business
combination
\u00a0
is the fair
\u00a0
value at
\u00a0
the date of
\u00a0
acquisition.
\u00a0
Following
\u00a0
that initial
\u00a0
recognition,
\u00a0
intangible
\u00a0
assets are
\u00a0
carried at
\u00a0
cost less
\u00a0
accumulated
amortisation and any impairment losses.
\u00a0
The straight-line
\u00a0
amortisation method is used for most intangible
\u00a0
assets as this best reflects the
consumption
\u00a0
of the assets.
\u00a0
The amortisation
\u00a0
period for
\u00a0
a customer
\u00a0
base is
\u00a0
the expected
\u00a0
lifetime
\u00a0
of the customer
\u00a0
relationship,
\u00a0
and the amortisation
method is
\u00a0
based on
\u00a0
historical
\u00a0
experience
\u00a0
of churn (customers
\u00a0
ending their
\u00a0
relationship)
\u00a0
for the different
\u00a0
businesses.
\u00a0
The useful
\u00a0
lives and
amortisation methods are reviewed at least annually.
\u00a0
Refer to note 18 for further information
\u00a0
about impairment.
Key judgments
\u00a0
and estimates
Amortisation expenses are based on management\u2019s estimates of
\u00a0
amortisation method, useful life and residual value.
\u00a0
Estimates may change due to
technological developments, changed competition or market conditions,
\u00a0
geopolitical developments and other factors. In particular,
\u00a0
technological
developments
\u00a0
are difficult
\u00a0
to predict
\u00a0
as trends
\u00a0
and pace
\u00a0
of development
\u00a0
may change
\u00a0
over time.
\u00a0
Estimated
\u00a0
useful lives
\u00a0
for similar
\u00a0
types of assets
may vary
\u00a0
between
\u00a0
different
\u00a0
entities due
\u00a0
to factors
\u00a0
such as growth
\u00a0
rate, maturity
\u00a0
of the market,
\u00a0
history and
\u00a0
expectations
\u00a0
for replacements
\u00a0
or
transfer of
\u00a0
assets, climate
\u00a0
and quality
\u00a0
of the technology
\u00a0
used. A change
\u00a0
in estimated
\u00a0
useful life
\u00a0
is a change
\u00a0
in accounting
\u00a0
estimate,
\u00a0
and
amortisation plans are adjusted prospectively. Refer to
\u00a0
note 18 for further information about impairment.
Intangible assets
NOK in millions
Customer
base
Trade-
marks
1)
Software
acquired
Internally
generated
software
Others
Work in
progress
2)
Total
As of 1 January 2021
2 560
6 372
19 762
4 253
2 097
1 894
36 938
Reclassifications
3)
-
-
1 386
700
( 423)
(2 053)
( 391)
Additions
-
-
1 111
-
99
1 379
2 589
Additions internally developed
-
-
-
219
8
-
227
Translation differences
( 114)
( 331)
( 518)
( 103)
( 92)
( 40)
(1 199)
Derecognition
( 77)
-
( 871)
( 392)
( 250)
( 1)
(1 592)
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
-
-
( 361)
-
-
-
( 361)
As of 31 December 2021
2 369
6 041
20 510
4 677
1 438
1 178
36 212
Reclassifications
3)
-
-
1 017
415
31
(1 448)
15
Additions
-
-
1 129
-
36
1 819
2 984
Additions internally developed
-
-
-
99
9
-
108
Translation differences
87
356
81
( 26)
( 21)
1
478
Derecognition
-
( 158)
(2 752)
( 153)
( 378)
( 275)
(3 716)
As of 31 December 2022
2 456
6 240
19 985
5 011
1 115
1 275
36 081
Accumulated amortisation and impairment
As of 1 January 2021
(1 064)
(3 086)
(16 309)
(3 552)
(1 703)
( 2)
(25 716)
Reclassifications
3)
-
-
-
( 40)
230
-
190
Amortisation - continuing operations
( 247)
-
(1 955)
( 504)
( 188)
-
(2 894)
Amortisation - discontinued operations
-
-
( 184)
-
-
-
( 184)
Impairment - discontinued operations
-
-
( 140)
-
-
-
( 140)
Translation differences
50
178
420
62
88
-
798
Derecognition
77
-
855
383
250
2
1 569
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
-
-
361
-
-
-
361
As of 31 December 2021
(1 184)
(2 907)
(16 954)
(3 651)
(1 323)
-
(26 018)
Reclassifications
3)
-
-
1
-
3
-
4
Amortisation - continuing operations
( 238)
-
(1 984)
( 604)
( 70)
-
(2 898)
Amortisation - discontinued operations
-
-
( 173)
-
-
-
( 173)
Impairment - continuing operations
-
-
( 29)
-
-
-
( 30)
Translation differences
( 40)
( 189)
( 17)
10
23
-
( 214)
Derecognition
-
147
2 273
138
378
-
2 936
As of 31 December 2022
(1 463)
(2 949)
(16 884)
(4 108)
( 990)
-
(26 392)
Carrying amount
As of 31 December 2022
993
3 291
3 101
904
125
1 275
9 689
As of 31 December 2021
1 185
3 134
3 556
1 026
115
1 178
10 195
Amortisation periods in years
3-20
-
3-7
3
3-5
-
-
1)
Trademarks have indefinite useful lives.
\u00a0
2)
The Additions line items represent net additions
\u00a0
of work in progress during the financial year. Work
\u00a0
in progress capitalised and activated within the
\u00a0
same
financial year is shown as Additions in the relevant
\u00a0
asset categories in this table.
3)
Including reclassifications to/from other lines in the statement
\u00a0
of financial position which are not a part of
\u00a0
this table.
NOTE 16
Right-of-use assets
Telenor has chosen to account for the right to use the spectrum as a lease,
\u00a0
where the identified asset is the
frequency band that is exclusive for Telenor in the lease period. Telenor
\u00a0
also leases passive infrastructure such as
towers and cables in addition to land and property. Refer to 29 for
\u00a0
more information about lease liabilities.
\u00a0
Accounting policies
A lease
\u00a0
liability
\u00a0
and a right-of-use
\u00a0
asset is
\u00a0
recognised
\u00a0
at commencement
\u00a0
date in
\u00a0
lease contracts
\u00a0
where Telenor
\u00a0
has the right
\u00a0
to direct
\u00a0
the use and
obtains substantially
\u00a0
all the economic
\u00a0
benefits
\u00a0
from the
\u00a0
use of an
\u00a0
identified
\u00a0
asset. For
\u00a0
spectrum
\u00a0
contracts,
\u00a0
Telenor
\u00a0
has chosen
\u00a0
to account
\u00a0
for the
right to
\u00a0
use the spectrum
\u00a0
as a lease,
\u00a0
where the
\u00a0
identified
\u00a0
asset is
\u00a0
the frequency
\u00a0
band that
\u00a0
is exclusive
\u00a0
for Telenor
\u00a0
during the
\u00a0
lease period.
\u00a0
Lease
payments on short-term leases
\u00a0
(less than 12 months) and low-value asset leases
\u00a0
(mainly office equipment) are generally expensed on
\u00a0
a straight-line
basis over the lease term. The short-term
\u00a0
exemption does not apply to spectrum leases or
\u00a0
leases with purchase options.
\u00a0
The lease liability represents the net present value
\u00a0
of lease payments over the lease period
\u00a0
and include fixed payments, in-substance fixed
payments, non-lease components, residual value
\u00a0
guarantees and lease incentives. The lease payments also
\u00a0
include the exercise price of a
purchase option reasonably certain to be exercised
\u00a0
and termination penalties when termination is expected.
\u00a0
Variable lease payments such as
licence payments based on revenue sharing arrangements
\u00a0
are expensed as incurred.
The incremental
\u00a0
borrowing
\u00a0
rate generally
\u00a0
used to determine
\u00a0
the net present
\u00a0
value is
\u00a0
based on
\u00a0
the respective
\u00a0
country\u2019s risk-free
\u00a0
rate for
\u00a0
the term
corresponding
\u00a0
to the lease term, adjusted for own
\u00a0
credit risk. Subsidiaries with external financing use
\u00a0
the external borrowing rate corresponding to
The non-cancellable lease period is basis for
\u00a0
the lease liability, and periods covered by
\u00a0
options to extend or terminate the lease are
\u00a0
included only
when it is reasonably certain the lease period
\u00a0
will be extended. The lease liability is remeasured if
\u00a0
the lease term or lease payments change,
\u00a0
or there
are other modifications. Significant amounts paid up-front
\u00a0
on spectrum and other lease contracts are
\u00a0
recognised as prepayment until
Right-of-use assets are measured
\u00a0
at cost, less accumulated depreciation and impairments,
\u00a0
and adjusted for any remeasurement of lease
\u00a0
liabilities.
The right-of-use asset includes estimated costs for
\u00a0
dismantling and removing the underlying leased asset, restoring the
\u00a0
site on which it is located
or restoring the underlying leased asset to the
\u00a0
condition required by the terms and conditions of
\u00a0
the lease. Non-refundable value-added tax
\u00a0
is
included as initial direct cost. The right-of-use asset is
\u00a0
depreciated on a straight-line
\u00a0
basis over the shorter of its estimated
\u00a0
useful life and the lease
term. Right-of-use
\u00a0
assets where
\u00a0
it is reasonably
\u00a0
certain that
\u00a0
Telenor will
\u00a0
exercise
\u00a0
a purchase
\u00a0
option at
\u00a0
the end of
\u00a0
the lease
\u00a0
term are
\u00a0
not
depreciated.
Key judgments
\u00a0
and estimates
Determining the lease term can involve significant judgment
\u00a0
for lease contracts with extension or
\u00a0
termination options, as an assessment of
whether or
\u00a0
not it is
\u00a0
reasonably
\u00a0
certain that
\u00a0
the lease
\u00a0
period will
\u00a0
be extended
\u00a0
is required.
\u00a0
The broader
\u00a0
economics
\u00a0
of the contract
\u00a0
and not
\u00a0
only
contractual termination payments are basis for such
\u00a0
assessment. For lease of land for own towers or
\u00a0
leasing of towers from tower companies or
other operators,
\u00a0
factors considered
\u00a0
in particular
\u00a0
for assessing
\u00a0
the lease
\u00a0
term are
\u00a0
technology
\u00a0
development
\u00a0
and potential
\u00a0
changes in
\u00a0
business
models.
\u00a0
Based on
\u00a0
an assessment
\u00a0
of these
\u00a0
factors,
\u00a0
the lease
\u00a0
term for Telenor\u2019s
\u00a0
leases relating
\u00a0
to sites will
\u00a0
normally
\u00a0
be within
\u00a0
a range of
\u00a0
4 to 7 years.
This means
\u00a0
that the lease
\u00a0
term for
\u00a0
sites with
\u00a0
renewal
\u00a0
options shall
\u00a0
normally
\u00a0
be the higher
\u00a0
of a non-cancellable
\u00a0
period or
\u00a0
within a
\u00a0
range of
\u00a0
4 to 7
years. Some sites may be in strategically important
\u00a0
locations and it might be more than
\u00a0
reasonably certain that the sites will be maintained
\u00a0
beyond
7 years.
\u00a0
In these exceptional
\u00a0
cases, the
\u00a0
lease term
\u00a0
may be up
\u00a0
to 10 years.
Right-of-use assets
Right-of-use assets are classified based
\u00a0
on the nature of underlying assets as follow:
NOK in millions
Spectrum
licences
1)
structure
Cables
Land
Buildings
Others
Total
As of 1 January 2021
53 423
20 464
5 851
5 618
4 167
116
89 638
Additions
4 403
2 999
213
748
452
200
9 015
Derecognition
( 93)
(1 121)
( 191)
( 453)
( 348)
( 40)
(2 246)
Reclassifications
( 2)
( 326)
-
238
87
-
( 2)
Translation differences
(2 930)
(1 405)
( 415)
( 299)
( 157)
-
(5 207)
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
(4 563)
(4 414)
(1 403)
( 105)
( 102)
( 6)
(10 594)
As of 31 December 2021
50 237
16 197
4 054
5 747
4 099
270
80 604
Additions
4 845
2 435
1 026
716
816
125
9 963
Derecognition
( 766)
(1 258)
( 291)
( 507)
( 330)
( 28)
(3 180)
Disposal of companies
(5 729)
(4 157)
( 25)
(1 271)
( 60)
( 2)
(11 243)
Reclassifications
1
( 99)
( 17)
-
( 20)
-
( 135)
Translation differences
287
133
( 160)
112
73
3
447
As of 31 December 2022
48 875
13 251
4 586
4 797
4 579
368
76 456
Accumulated
\u00a0
depreciation
As of 1 January 2021
(16 264)
(5 276)
(2 272)
(1 646)
(1 321)
( 46)
(26 826)
Amortisation - continuing operations
(3 073)
(2 365)
( 481)
( 769)
( 700)
( 60)
(7 447)
Amortisation - discontinued operations
( 368)
( 871)
( 133)
( 247)
( 25)
( 2)
(1 646)
Impairment - discontinued operations
(2 542)
-
-
-
-
-
(2 542)
Reassessment
\u00a0
of right-of-use
\u00a0
assets -
\u00a0
discontinued
operations
( 136)
(2 103)
( 720)
( 47)
( 40)
( 1)
(3 047)
Derecognition
93
572
180
278
312
34
1 469
Reclassifications
( 3)
15
( 2)
4
( 14)
-
-
Translation differences
795
391
121
92
70
4
1 473
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
4 543
3 651
1 150
89
88
5
9 526
As of 31 December 2021
(16 954)
(5 986)
(2 156)
(2 247)
(1 631)
( 66)
(29 040)
Amortisation - continuing operations
(3 341)
(2 289)
( 489)
( 780)
( 723)
( 76)
(7 690)
Amortisation - discontinued operations
( 281)
( 518)
( 6)
( 219)
( 12)
-
(1 036)
Impairment - continuing operations
-
( 576)
( 93)
( 272)
( 22)
-
( 963)
Derecognition
740
1 010
144
322
332
26
2 574
Disposal of companies
2 869
1 748
20
530
27
2
5 195
Reclassifications
( 18)
133
( 44)
-
19
-
90
Translation differences
85
( 4)
82
( 23)
( 34)
( 2)
105
As of 31 December 2022
(16 900)
(6 482)
(2 540)
(2 688)
(2 043)
( 116)
(30 770)
Carrying amount
As of 31 December 2021
33 283
10 211
1 898
3 500
2 468
204
51 565
As of 31 December 2022
31 975
6 769
2 046
2 109
2 535
251
45 686
Weighted
\u00a0
average remaining
\u00a0
lease term
As of 31 December 2021
1)
-
5
7
5
9
3
-
As of 31 December 2022
1)
-
5
7
4
9
3
-
Related lease liability disaggregated per class of
As of 31
\u00a0
December
\u00a0
2021
14 760
10 134
1 460
4 499
4 024
201
35 077
As of 31
\u00a0
December
\u00a0
2022
14 878
7 082
1 619
3 263
4 004
245
31 091
1)
See table below for overview spectrum licences,
\u00a0
including lease term.
For lease
\u00a0
of network
\u00a0
passive infrastructure
\u00a0
(lease of
\u00a0
tower space
\u00a0
in networks
\u00a0
and lease
\u00a0
of part of
\u00a0
buildings
\u00a0
for own towers),
\u00a0
land for
\u00a0
own sites
\u00a0
or
towers and lease of buildings for office spaces,
\u00a0
equipment and retail stores, lease agreements generally
\u00a0
contain termination options or renewal
options. These
\u00a0
options are
\u00a0
used to limit
\u00a0
the period
\u00a0
to which
\u00a0
Telenor is
\u00a0
committed
\u00a0
to individual
\u00a0
lease contracts
\u00a0
and to maximise
\u00a0
operational
flexibility in terms of dynamic network requirements. The remaining
\u00a0
non-cancellable period for lease contracts under
\u00a0
network passive
infrastructure is 3 years on average.
\u00a0
The non-cancellable period for lease contracts
\u00a0
related to land is 2 years on average, which
\u00a0
is mainly driven by
non-cancellable lease agreements in Thailand.
\u00a0
As a result of deteriorating macro-economic
\u00a0
situation in Pakistan, an impairment of NOK
\u00a0
963 million related to
\u00a0
right-of-use assets was recognised
in 2022. Please see note 18 for
\u00a0
further information.
\u00a0
In 2021, due to a worsening security and
\u00a0
human rights situation in Myanmar, Telenor made an
impairment
\u00a0
of the right
\u00a0
of use assets
\u00a0
and at the
\u00a0
same time
\u00a0
reassessed
\u00a0
the lease
\u00a0
term of all
\u00a0
the lease
\u00a0
agreements
\u00a0
in Myanmar,
\u00a0
limiting
\u00a0
the lease
term to one
\u00a0
year.
\u00a0
The additions
\u00a0
of spectrum
\u00a0
licences
\u00a0
in 2022 were
\u00a0
related to
\u00a0
additional
\u00a0
spectrum
\u00a0
fee of NOK
\u00a0
1.7 billion
\u00a0
in Pakistan,
\u00a0
which is
\u00a0
pursuant to
\u00a0
the Supreme
Court ruling there the detailed judgement is
\u00a0
still awaited, see further below and note
\u00a0
23 for more information. Moreover, the additions
\u00a0
were related
to acquisition of spectrum under 3500 MHz in
\u00a0
Norway, 2100 MHz in Denmark, and 2600 MHz in
\u00a0
Grameenphone. The additions of spectrum licences
in 2021 were primarily related to renewal
\u00a0
of spectrum under the 900 MHz and 1800
\u00a0
MHz bands in Pakistan, acquisition of spectrum under
\u00a0
1800 MHz
and 2100
\u00a0
MHz bands in Grameenphone, 3500 MHz band in
\u00a0
Sweden and 3500 MHz and 26 GHz bands
\u00a0
in Denmark.
In 2022,
\u00a0
the additions in network passive infrastructure were
\u00a0
mainly related to site leases from towercos
\u00a0
in Grameenphone, contract renewal of
CAT equipment lease in dtac, tower spaces
\u00a0
and part of building for own towers Telenor
\u00a0
Norway and Finland. The additions in cables were
\u00a0
mainly in
Sweden and Grameenphone.
\u00a0
The additions in building were mainly related
\u00a0
to Telenor Real Estate, Telenor South East Asia
\u00a0
Investment Pte Ltd.,
Telenor Sweden and Telenor Denmark. The additions in land
\u00a0
were mainly related to land for own sites
\u00a0
in dtac and Pakistan.
In 2021, the additions in network passive
\u00a0
infrastructure were mainly related to site leases from
\u00a0
towerco in Grameenphone, CAT equipment in dtac,
tower spaces and part of building for own
\u00a0
towers in Digi and Telenor Norway. The
\u00a0
additions in cables were mainly in Sweden. The additions in
building
\u00a0
were mainly
\u00a0
related to
\u00a0
dtac and
\u00a0
Telenor Infra.
\u00a0
The additions
\u00a0
in land
\u00a0
were mainly
\u00a0
related to
\u00a0
land for
\u00a0
own sites
\u00a0
in dtac,
\u00a0
Digi and
\u00a0
Pakistan.
For lease of spectrum, the agreements are
\u00a0
generally non-cancellable. Telenor has not considered periods
\u00a0
covered by renewal options even if in
some agreements
\u00a0
the option to renew exists, given the
\u00a0
uncertainty around terms and conditions of renewal
\u00a0
of licences.
The following table sets forth the spectrum
\u00a0
licences that Telenor holds as of 31 December
\u00a0
2022:
Spectrum (MHz)
Spectrum expiration
Telenor Norway
700
2x10
2039
800
2\u00d710
2033
900
2\u00d715
2033
1800
2\u00d710 + 2\u00d720
2028/2033
2100
2\u00d720
2032
3500
120
2042
Telenor Sweden
700
2x10
1)
2040
800
2x10
1)
2035
900
2x6
1)
2025
1800
2\u00d720
1)
1)
2027/2037
2100
2x10
1),3)
\u00a0
+ 2\u00d79.8 +
\u00a0
5
2025
2600
2x40
2)
2025
3500
100
1)
2045
Telenor Denmark
700
2x5
4)
2040
800
2x10
4)
2034
900
2x10
4)
2034
1500
45
4)
2042
1800
2\u00d725
4)
2032
2100
2\u00d715 + 1\u00d75
2022
2100
2\u00d720
4)
2042
2600
2\u00d720 + 10
2030
3500
140
4)
2042
26000
600
4)
2042
DNA, Finland
700
2x10
2033
800
2x10
2033
900
2x11.6
2033
1800
2x24.8
2033
2100
2x19.8
2033
2600
2x20
2029
3500
130
2033
26000
800
2033
dtac, Thailand
700
2x10
2035
900
2x5
2033
1800
2\u00d75
2033
2100
2x15
2027
2300
60
5)
2025
26000
200
2035
Grameenphone, Bangladesh
900
2\u00d77.4
2026
1800
2\u00d77.4
2026
1800
2\u00d77.2
2026
1800
2x5
2033
1800
2x0.4
2026
2100
2\u00d710
2028
2100
2\u00d710
2026
2600
60
2033
Telenor Pakistan
850
2x10
2031
900
2\u00d74.8
2034
1800
2\u00d78.8
2034
2100
2\u00d75
2029
1)
The licenses are held by Net4Mobility (a joint operation
\u00a0
with Tele 2, owned 50% by Telenor).
2)
Tele 2 and Telenor transferred their respective licences
\u00a0
(2\u00d720 MHz) in the 2600 MHz band to Net4Mobility
\u00a0
on 2 July 2012.
3)
Telenor transferred 2x10 MHz (out of 2x19.6 MHz) in the
\u00a0
2100 MHz band to Net4Mobility on 25 February 2022.
4)
The licenses are held by TT Netv\u00e6rket (a joint operation
\u00a0
with Telia, owned 50% by Telenor).
5)
The spectrum is held under capacity agreement with TOT
\u00a0
and therefore not part of right-of-use assets.
Telenor
\u00a0
Pakistan\u2019s
\u00a0
900 MHz
\u00a0
and 1800
\u00a0
MHz spectrum
\u00a0
licence
\u00a0
expired on
\u00a0
25 May 2019,
\u00a0
and the renewal
\u00a0
fee was
\u00a0
set to NOK
\u00a0
4.0 billion
\u00a0
(USD 449
million)
\u00a0
by the Pakistan
\u00a0
Telecommunication
\u00a0
Authority
\u00a0
(PTA) for
\u00a0
an extension
\u00a0
period of
\u00a0
15 years.
\u00a0
Telenor Pakistan
\u00a0
disagreed
\u00a0
with the
\u00a0
terms and
conditions for renewal, primarily on the price.
\u00a0
Telenor Pakistan is of the opinion that
\u00a0
the renewal price should have been NOK 2.5
\u00a0
billion (USD 291
million),
\u00a0
which was
\u00a0
the same
\u00a0
as for prior
\u00a0
renewals
\u00a0
for other
\u00a0
operators.
\u00a0
Accordingly,
\u00a0
Telenor Pakistan
\u00a0
challenged
\u00a0
the terms
\u00a0
and conditions
\u00a0
for
renewal of said licence in Islamabad High
\u00a0
Court. On 19 July 2021, the High
\u00a0
Court decided the case in Telenor\u2019s disfavor.
\u00a0
Telenor Pakistan appealed
the case
\u00a0
to the Supreme
\u00a0
Court on
\u00a0
31 August
\u00a0
2021. In
\u00a0
December
\u00a0
2021, Telenor
\u00a0
Pakistan
\u00a0
signed the
\u00a0
licence under
\u00a0
protest whilst
\u00a0
waiting
\u00a0
for the
Supreme Court\u2019s
\u00a0
hearing of the case. On 25 May
\u00a0
2022, the Supreme Court rejected the appeal. The
\u00a0
new spectrum price is considered a variable
lease payment that has become in-substance
\u00a0
fixed, and the right-of-use asset and lease
\u00a0
liability has been adjusted accordingly. Telenor Pakistan is
still waiting for the written Supreme Court decision
\u00a0
and will assess to file a review petition. Telenor
\u00a0
Pakistan has paid a total of NOK
\u00a0
2.8 billion (USD
314 million
\u00a0
excl. interest)
\u00a0
of the demanded
\u00a0
licence renewal
\u00a0
fees.
\u00a0
See note 18
\u00a0
for further
\u00a0
information
\u00a0
about impairment
\u00a0
of Pakistan
\u00a0
following
\u00a0
the
Supreme Court
\u00a0
ruling.
Lease expenses
Expenses
\u00a0
recognised
\u00a0
in the income
\u00a0
statement
\u00a0
related
\u00a0
to lease
\u00a0
contracts
\u00a0
are presented
\u00a0
below:
NOK in millions
Classification
\u00a0
in income statement
\u00a0
2022
2021
Depreciation of right-of-use assets
Depreciation
\u00a0
and amortisation
7 690
7 447
Interest expenses
\u00a0
on lease
\u00a0
liabilities
Financial
\u00a0
expenses (note
\u00a0
9)
1 058
1 053
Variable
\u00a0
lease expenses
\u00a0
not dependant
\u00a0
on index
\u00a0
or rate
Other operating
\u00a0
expenses
\u00a0
(note 6)
2 145
2 057
Variable
\u00a0
lease expenses
\u00a0
not dependant
\u00a0
on index
\u00a0
or rate
Cost of materials and traffic charges (note
\u00a0
4)
\u00a0
141
116
Expenses
\u00a0
relating
\u00a0
to short term
\u00a0
leases
Other operating
\u00a0
expenses
\u00a0
(note 6)
54
116
Expenses
\u00a0
relating
\u00a0
to low value
\u00a0
leases
Other operating
\u00a0
expenses
\u00a0
(note 6)
13
12
Total
11 103
10 801
Variable
\u00a0
lease expenses
\u00a0
of NOK 2.3
\u00a0
billion (NOK
\u00a0
2.2 billion
\u00a0
in 2021)
\u00a0
recognised
\u00a0
in other
\u00a0
operating
\u00a0
expenses include
\u00a0
NOK 1.7
\u00a0
billion (NOK
\u00a0
1.8 billion
\u00a0
in
2021) related
\u00a0
to spectrum
\u00a0
and NOK
\u00a0
0.4 billion
\u00a0
(NOK 0.3
\u00a0
billion in
\u00a0
2021) related
\u00a0
to other lease
\u00a0
contracts.
\u00a0
Variable
\u00a0
lease expenses
\u00a0
related
\u00a0
to spectrum
agreements vary mainly with revenue, as a significant
\u00a0
part of the expenses are based on
\u00a0
share of revenues under the agreements. Variable lease
expenses
\u00a0
related
\u00a0
to other lease
\u00a0
contracts
\u00a0
of NOK 0.4
\u00a0
billion
\u00a0
(0.3 billion
\u00a0
NOK in 2021)
\u00a0
represent
\u00a0
energy charges
\u00a0
paid to
\u00a0
lessors as
\u00a0
part of
\u00a0
the lease
agreements for some mobile sites, and the
\u00a0
expenses vary with the consumption of energy
\u00a0
on those mobile sites.
NOTE 17
Property, plant and equipment
The majority of the property, plant and equipment (PPE) in Telenor relate
\u00a0
to investments in network equipment and
infrastructure, including base stations, cables, fiber
\u00a0
and radio equipment.
\u00a0
Other assets include equipment for
cable TV and satellites in addition to buildings, land and administrative
\u00a0
assets.
\u00a0
Accounting policies
Property, plant and equipment are recognised at
\u00a0
cost less accumulated depreciation and any impairment
\u00a0
losses.
\u00a0
The cost includes borrowing
costs for
\u00a0
qualifying
\u00a0
assets.
\u00a0
If Telenor
\u00a0
has a legal
\u00a0
or constructive
\u00a0
obligation
\u00a0
to dismantle,
\u00a0
remove
\u00a0
and restore
\u00a0
a site, an
\u00a0
asset retirement
\u00a0
obligation
(ARO) is recognized with a corresponding increase in the
\u00a0
related asset within property, plant and equipment.
\u00a0
AROs primarily relate to base stations
and installed network and infrastructure equipment in
\u00a0
addition to some buildings, refer to note
\u00a0
22 for further information. Estimated useful lives for
similar types of assets may vary between
\u00a0
different geographical areas due to factors such
\u00a0
as growth rate, maturity of the market,
\u00a0
history and
expectations for replacements or transfer of assets,
\u00a0
climate and quality of components used. Estimated useful
\u00a0
life, depreciation method and
residual
\u00a0
value are
\u00a0
evaluated
\u00a0
at least annually.
\u00a0
The straight-line
\u00a0
depreciation
\u00a0
method is
\u00a0
used as this
\u00a0
best reflects
\u00a0
the consumption
\u00a0
of the assets,
which often is the passage of time.
\u00a0
Residual value is estimated to be zero for
\u00a0
most assets, except for some commercial buildings
\u00a0
and vehicles that
are not expected to be used for
\u00a0
the whole economic life. Refer to note
\u00a0
18 for further information about impairment.
Key judgments
\u00a0
and estimates
Depreciation expenses are based on management\u2019s estimates of
\u00a0
depreciation method, useful life and residual value. Estimates
\u00a0
may change due to
technological developments, competition, changes in market conditions,
\u00a0
geopolitical developments, climate change and other factors.
\u00a0
In
particular, technological developments are difficult to predict
\u00a0
as trends and pace of development may
\u00a0
change over time. The asset retirement
obligation
\u00a0
(ARO) is a
\u00a0
significant
\u00a0
estimate as
\u00a0
there is
\u00a0
significant
\u00a0
uncertainty
\u00a0
related
\u00a0
to the timing
\u00a0
of the removal
\u00a0
and restoration
\u00a0
of the sites,
\u00a0
and also
whether the restoration actually will take place. There
\u00a0
is also significant uncertainty related to future
\u00a0
price development as the work will take
\u00a0
place
well into
\u00a0
the future.
\u00a0
See note
\u00a0
22 for further
\u00a0
information
\u00a0
about the
\u00a0
asset removal
\u00a0
obligation.
\u00a0
Climate changes
\u00a0
can potentially
\u00a0
lead to destruction
\u00a0
of
assets from flooding, fires or other natural
\u00a0
disasters. Climate changes and increased focus on
\u00a0
sustainable businesses may impact technological
development, markets and economic or legal environment which
\u00a0
are critical estimates in the evaluations of
\u00a0
useful lives. A change in estimated
useful life
\u00a0
is a change
\u00a0
in accounting
\u00a0
estimate,
\u00a0
and depreciation
\u00a0
plans are
\u00a0
adjusted
\u00a0
prospectively.
\u00a0
Refer to
\u00a0
note 18 for
\u00a0
further information
\u00a0
about
impairment.
Property, plant
\u00a0
and equipment
NOK in millions
Local,
and trunk
networks
Mobile
telephone
network
Subscribe
r
equipmen
t
Switches
and equip-
ment
Radio
installa-
tions
Cable-TV
equipmen
t
Buildings
Land
Corporate
adminis-
trative
assets
Satellites
Work in
progress
1)
Total
As of 1 January 2021
64 248
40 324
2 651
15 785
46 725
6 502
7 229
686
11 383
5 021
6 814
207 369
Reclassifications
2)
1 890
3 014
195
484
3 270
84
(560)
3
(106)
-
(7 839)
436
Additions
1 653
792
752
367
1 784
65
35
2
703
(14)
8 749
14 888
Translation differences
(1 187)
(1 685)
(65)
(403)
(1 920)
(59)
(127)
(28)
(381)
-
(223)
(6 079)
Derecognitions
(869)
(1 645)
(504)
(1 219)
(2 271)
(28)
(155)
(3)
(872)
-
(7)
(7 574)
Reclassified to assets held for
sale
(2 064)
(1 564)
(1)
(484)
(3 751)
(272)
(36)
-
(465)
-
(167)
(8 804)
As of 31
\u00a0
December
\u00a0
2021
63 671
39 236
3 028
14 530
43 837
6 293
6 386
660
10 262
5 007
7 326
200 235
Reclassifications
2)
1 321
2 496
(15)
283
2 294
34
(548)
(40)
702
-
(6 551)
(24)
Additions
1 842
547
582
361
2 438
48
90
18
771
-
7 093
13 789
Translation differences
542
109
(21)
(47)
397
(19)
30
7
(85)
-
39
953
Derecognitions
(5 420)
(8 952)
(837)
(3 027)
(10 574)
(371)
(464)
(67)
(1 945)
-
(408)
(32 064)
As of 31
\u00a0
December
\u00a0
2022
61 956
33 435
2 737
12 099
38 393
5 985
5 494
578
9 705
5 007
7 500
182 888
Accumulated depreciation and impairment losses
As of 1 January 2021
(40 166)
(23 439)
(1 431)
(13 642)
(28 912)
(4 252)
(4 797)
(4)
(7 913)
(3 442)
-
(128 001)
Reclassifications
2)
(402)
(448)
(9)
(2)
(397)
-
381
1
641
-
-
(236)
Depreciation - continuing
operations
(2 705)
(2 924)
(823)
(675)
(4 289)
(395)
(244)
-
(643)
(206)
-
(12 905)
Depreciation - discontinued
operations
(297)
(763)
-
(141)
(380)
-
(7)
-
(103)
-
-
(1 691)
Impairment - discontinued
operations
(641)
(817)
-
(43)
(1 488)
-
(15)
-
(215)
-
(176)
(3 395)
Translation differences
503
935
48
325
1 180
38
74
1
227
-
-
3 331
Derecognition
862
1 559
504
1 218
2 257
27
123
-
811
-
-
7 361
Reclassified to assets held for
sale
1 463
1 562
1
484
3 746
135
36
-
465
-
176
8 067
As of 31
\u00a0
December
\u00a0
2021
(41 383)
(24 335)
(1 711)
(12 475)
(28 283)
(4 447)
(4 451)
(2)
(6 733)
(3 648)
-
(127 468)
Reclassifications
2)
(119)
(583)
91
34
39
-
541
-
2
-
-
4
Depreciation - continuing
operations
(2 565)
(2 724)
(862)
(674)
(4 353)
(309)
(210)
-
(780)
(202)
-
(12 681)
Depreciation - discontinued
operations
(243)
(573)
-
(120)
(225)
-
(6)
-
(65)
-
-
(1 231)
Impairment - continuing
operations
(179)
(606)
-
(103)
(399)
-
(108)
(38)
(77)
-
-
(1 509)
Translation differences
(78)
123
15
67
(145)
14
(17)
3
129
-
-
110
Derecognition
4 234
6 259
836
2 657
9 235
369
195
-
1 762
-
-
25 546
As of 31
\u00a0
December
\u00a0
2022
(40 332)
(22 440)
(1 631)
(10 615)
(24 132)
(4 373)
(4 056)
(38)
(5 762)
(3 850)
-
(117 229)
As of 31
\u00a0
December
\u00a0
2022
21 623
10 995
1 106
1 485
14 260
1 612
1 438
540
3 943
1 157
7 500
65 659
As of 31
\u00a0
December
\u00a0
2021
22 287
14 901
1 317
2 055
15 554
1 846
1 935
658
3 529
1 359
7 326
72 767
Depreciation periods, years
3)
3-30
5-20
3
3-7
5-15
3-15
5-30
-
2-10
17
-
-
1)
The Additions line items represent net additions
\u00a0
of work in progress during the financial year. Work
\u00a0
in progress capitalised and activated within
\u00a0
the same
financial year is shown as Additions in the relevant
\u00a0
asset categories in this table.
2)
Including reclassifications to/from other lines in the statement
\u00a0
of financial position which is not a part of this
\u00a0
table.
3)
Asset categories presented in this movement schedule
\u00a0
is an aggregated total from different asset components
\u00a0
belonging to a particular category, and the
disclosed depreciation rates represent a range of useful
\u00a0
lives allocated to components.
.
NOTE 18
Impairment of assets
Telenor has significant investments in the network and infrastructure
\u00a0
required to operate in the telecom industry,
such as base stations, networks and radio equipment.
\u00a0
Other significant assets include goodwill, customer bases
and software. Goodwill is tested for impairment annually or
\u00a0
when impairment indicators
\u00a0
are present.
\u00a0
In 2022,
Telenor has recognised impairment of NOK 2.5 billion related
\u00a0
to its operations in Pakistan following the adverse
ruling of Supreme Court in the licence renewal case.
\u00a0
Accounting policies
Impairment indicators are assessed at each reporting
\u00a0
date for individual assets and cash generating units
\u00a0
(CGUs),
\u00a0
and impairment testing is
performed if any indicators are identified. Goodwill, intangible
\u00a0
assets with indefinite useful life and intangible assets
\u00a0
not yet brought into use are
assessed for impairment annually or when impairment indicators
\u00a0
are identified. Identification of Telenor\u2019s main CGUs is
\u00a0
based on the countries
where Telenor operates its fixed and mobile
\u00a0
operations. The CGU may include both fixed and mobile
\u00a0
operations as they are monitored and
reported as one operating unit.
\u00a0
Goodwill arising from acquisitions are allocated to the
\u00a0
respective CGU and included in the impairment
\u00a0
test. Fair
values are
\u00a0
used in the
\u00a0
CGU testing
\u00a0
when these
\u00a0
are available,
\u00a0
for example
\u00a0
when the
\u00a0
CGU is a listed
\u00a0
company.
\u00a0
In assessing
\u00a0
value-in-use,
\u00a0
the
estimated
\u00a0
future cash
\u00a0
flows are
\u00a0
discounted
\u00a0
to their
\u00a0
present value
\u00a0
using a
\u00a0
discount rate
\u00a0
based on
\u00a0
the weighted
\u00a0
average cost
\u00a0
of capital
\u00a0
(WACC) rate.
The WACC
\u00a0
reflects
\u00a0
current market
\u00a0
assessments
\u00a0
of the time
\u00a0
value of
\u00a0
money and
\u00a0
the risks
\u00a0
specific
\u00a0
to the asset
\u00a0
or the CGU
\u00a0
to which
\u00a0
the asset
belongs. Impairments are recognised by reducing carrying
\u00a0
amount of goodwill first before other assets
\u00a0
are reduced on a pro-rata basis.
Impairments
\u00a0
of goodwill
\u00a0
are not reversed.
Key judgments
\u00a0
and estimates
Significant management judgment is used when assessing
\u00a0
impairment triggers at each reporting date. The
\u00a0
following factors are assessed:
significant
\u00a0
fall in market
\u00a0
values; significant
\u00a0
underperformance
\u00a0
relative
\u00a0
to historical
\u00a0
or projected
\u00a0
future operating
\u00a0
results;
\u00a0
significant
\u00a0
changes in
\u00a0
the
use of the
\u00a0
assets or
\u00a0
the strategy
\u00a0
for the overall
\u00a0
business,
\u00a0
including
\u00a0
assets that
\u00a0
are decided
\u00a0
to be phased
\u00a0
out or replaced
\u00a0
and assets that
\u00a0
are
damaged or taken out of use; significant
\u00a0
negative industry or economic trends; significant loss of
\u00a0
market share; significant adverse political and/or
regulatory development including unfavourable court decisions and significant
\u00a0
cost overruns in the development of assets.
The assessment of value-in-use
\u00a0
includes significant management judgments and estimates, including determining
\u00a0
the discount rate (WACC),
estimating future performance, revenue generating capacity of
\u00a0
the assets, margins, prices on future renewals
\u00a0
of spectrum licences, political and
regulatory risk, required maintenance capex, network costs
\u00a0
and technological developments, and assumptions of the
\u00a0
future market conditions.
There are significant variations between different markets
\u00a0
with respect to growth, mobile penetration,
\u00a0
average revenue per user (ARPU),
\u00a0
market
share, inflation, regulatory costs, and technological development,
\u00a0
resulting in differences in EBITDA margins, future investments,
\u00a0
and long terms
growth assumptions. In some markets, certain expenses
\u00a0
and capex are denominated in foreign currency and
\u00a0
impacted by currency fluctuations.
Recessionary effects and increased macroeconomic risks may
\u00a0
impact the estimates of growth, future performance
\u00a0
and discount rates used in
estimating recoverable amounts of assets. Discount
\u00a0
rates are impacted by several macroeconomic factors
\u00a0
including borrowing rates, country risk,
inflation assumptions and currency development. For assumptions
\u00a0
used, external evidence has been taken into consideration.
Climate-related
\u00a0
risks
Telenor is exposed to climate-related
\u00a0
physical risks such as potential damage to
\u00a0
infrastructure and utilities through the impact of
\u00a0
more extreme
weather events
\u00a0
and rising
\u00a0
sea levels.
\u00a0
Climate-related
\u00a0
regulatory
\u00a0
risks include
\u00a0
potentially
\u00a0
higher operational
\u00a0
costs due
\u00a0
to increasing
\u00a0
carbon taxes
and energy/fuel
\u00a0
taxes, as
\u00a0
well as
\u00a0
risks of higher
\u00a0
capital expenditures
\u00a0
due to a
\u00a0
required
\u00a0
transition
\u00a0
towards the
\u00a0
use of renewable
\u00a0
energy solutions
\u00a0
and
energy efficient
\u00a0
networks.
\u00a0
Climate-related
\u00a0
risks are
\u00a0
considered
\u00a0
in the cash
\u00a0
flow projections.
\u00a0
Cash flows
Discounted
\u00a0
cash flow
\u00a0
models have
\u00a0
been applied
\u00a0
to determine
\u00a0
the value-in-use
\u00a0
for cash-generating
\u00a0
units.
\u00a0
The cash
\u00a0
flows are
\u00a0
based on the
\u00a0
most
recent financial forecasts approved by management. Management has
\u00a0
projected cash flows based on financial forecasts and
\u00a0
strategy plans
covering the period 2023-2025
\u00a0
for DNA and Telenor Pakistan.
\u00a0
The cash flows beyond the explicit forecast
\u00a0
period have been extrapolated into
perpetuity
\u00a0
using a
\u00a0
constant nominal
\u00a0
growth rate
\u00a0
to arrive
\u00a0
at the terminal
\u00a0
value. The
\u00a0
estimates
\u00a0
of value
\u00a0
in use have
\u00a0
been compared
\u00a0
to market
valuation
\u00a0
and multiples
\u00a0
for peers
\u00a0
in the telecommunication
\u00a0
business
\u00a0
for reasonableness.
\u00a0
The expected growth in revenue, EBITDA, and
\u00a0
EBITDA margin for a cash-generating unit
\u00a0
is based on historical performance, expected
development in the market in which the entity
\u00a0
operates and assumptions in terms of development
\u00a0
in market share. The growth rates applied
\u00a0
in the
explicit forecast period converge from its current level
\u00a0
experienced over the last few years to the
\u00a0
long-term growth level in the market where
\u00a0
the
entity operates. The growth rates used to
\u00a0
extrapolate cash flow projections beyond the explicit forecast
\u00a0
period are not higher than the average
expected long-term growth in the markets in which
\u00a0
the entities operate. In periods with relatively
\u00a0
low discount rates, the estimated growth rates
used in the projections might be determined
\u00a0
significantly below the average expected long term growth observed
\u00a0
in the market.
Average revenue per user (ARPU)
\u00a0
ARPU is a measure for average revenue
\u00a0
per subscription per month, which is a key
\u00a0
component when estimating revenue growth. ARPU is
calculated based on mobile revenues from the
\u00a0
company\u2019s own subscriptions, divided by the average number
\u00a0
of subscriptions for the relevant
period. ARPU is estimated based on the current
\u00a0
ARPU level and expected
\u00a0
future market development.
EBITDA margin
1)
The EBITDA margin is estimated based on the
\u00a0
current margin level and expected future market development.
\u00a0
Committed or implemented
operational efficiency programmes are included. Changes in
\u00a0
the outcome of these initiatives may affect
\u00a0
future estimated EBITDA margins.
\u00a0
Capital expenses
\u00a0
(capex)
1)
\u00a0
and spectrum licences
\u00a0
A normalised level of capex as a percentage
\u00a0
of revenues (capex/revenues) is assumed in the
\u00a0
long run. Changes in traffic volumes and
\u00a0
number of
subscriptions during a growth phase
\u00a0
will affect the future capex/revenues
\u00a0
ratio. Estimated capex reflect the level of
\u00a0
capex needed for maintaining
current operation.
\u00a0
Costs related
\u00a0
to future spectrum
\u00a0
acquisitions
\u00a0
are estimated
\u00a0
based on
\u00a0
historical
\u00a0
levels of
\u00a0
spectrum costs
\u00a0
compared
\u00a0
to revenue
Included in the assessment of future spectrum
\u00a0
prices.
\u00a0
Telenor also takes into consideration the development in
\u00a0
neighbouring countries
\u00a0
and more
advanced markets for potential spectrum auctions in
\u00a0
emerging markets.
\u00a0
Discount rates are based on Weighted Average
\u00a0
Cost of Capital (WACC) derived from the Capital
\u00a0
Asset Pricing Model (CAPM) methodology. The
cost is derived from its weighted average cost
\u00a0
of capital. In economies where the Group
\u00a0
considers risk-free yields to be
\u00a0
unreliable, the WACC rates
used in discounting the future cash flows
\u00a0
are based on a US 30-year risk-free
\u00a0
interest rate, adjusted with a country risk
\u00a0
premium and the inflation
differential between the US and the relevant
\u00a0
country. The discount rates consider the debt
\u00a0
premium, market risk premium, gearing, corporate tax
rate, inflation, and asset beta. For cash-generating
\u00a0
units in economies with unstable inflation rates,
\u00a0
rolling discount rates are applied.
\u00a0
1)
Please refer to page 180 for description of alternative
\u00a0
performance measures.
\u00a0
Cash-generating
\u00a0
units (CGUs)
\u00a0
with significant
\u00a0
goodwill
The goodwill
\u00a0
allocated
\u00a0
to each CGU
\u00a0
is shown in
\u00a0
note 14.
\u00a0
The recoverable
\u00a0
amounts for
\u00a0
the cash-generating
\u00a0
units with
\u00a0
significant
\u00a0
goodwill
\u00a0
have been
determined based on the following discount rates
\u00a0
and terminal value nominal growth rates for
\u00a0
the years 2022 and 2021:
Discount
\u00a0
rate after tax
\u00a0
(%)
Discount
\u00a0
rate pre-tax
\u00a0
(%)
Nominal growth
\u00a0
in cash flow
\u00a0
in terminal
\u00a0
value (%)
2022
2021
2022
2021
2022
2021
Telenor Sweden
6.7
5.0
8.5
6.4
1.9
0.0
DNA
6.8
5.0
8.5
6.3
2.3
0.75
In the recoverable
\u00a0
amount assessment,
\u00a0
the Group
\u00a0
has applied
\u00a0
estimated
\u00a0
cash flows
\u00a0
after tax
\u00a0
and corresponding
\u00a0
discount rates
\u00a0
after tax.
\u00a0
The
recoverable amounts would not change significantly if
\u00a0
pre-tax cash flows and pre-tax discount rates
\u00a0
had been applied instead.
\u00a0
The war
\u00a0
in Ukraine
\u00a0
has generated
\u00a0
a sharp increase
\u00a0
in energy
\u00a0
prices following
\u00a0
the shortage
\u00a0
of supply,
\u00a0
and there
\u00a0
is increased
\u00a0
risk of supply
\u00a0
chain
disruption due to escalating trade tension and sanctions.
\u00a0
The risk related to continued high energy prices
\u00a0
and general inflation caused by the war is
reflected
\u00a0
in the forecasts
\u00a0
used as
\u00a0
basis for
\u00a0
the value
\u00a0
in use calculation.
,
Impairment
\u00a0
in 2022 and 2021
In 2022,
\u00a0
Telenor recognised
\u00a0
an impairment
\u00a0
of assets
\u00a0
of NOK 2.5
\u00a0
billion related
\u00a0
to Telenor
\u00a0
Pakistan
\u00a0
as a result
\u00a0
of several
\u00a0
negative developments.
\u00a0
A
significant increase in interest rates, country risk premium
\u00a0
and market premiums impacted the Weighted Average
\u00a0
Cost of Capital. A hike in energy
prices and increased global inflation made the
\u00a0
outlook for Telenor Pakistan challenging. Further, one of
\u00a0
the key assumptions in the assessment at
year end 2021 was the outcome of
\u00a0
the Supreme Court\u2019s hearing related to the
\u00a0
renewal fee for the 900 MHz and 1800 MHz
\u00a0
spectrum license. On 25
May 2022, the Supreme Court concluded the
\u00a0
fee to remain at the level set
\u00a0
by the Pakistani Telecommunication Authority, see note 23.
\u00a0
In June 2022
Telenor completed an assessment of value in use
\u00a0
based on discounted cash flows of Telenor
\u00a0
Pakistan with updated earnings projections. As a
consequence,
\u00a0
an impairment
\u00a0
of NOK 2.5
\u00a0
billion was
\u00a0
recognised
\u00a0
in the second
\u00a0
quarter 2022
\u00a0
related to
\u00a0
property,
\u00a0
plant and
\u00a0
equipment,
\u00a0
right-of-use
assets and intangible
\u00a0
assets in the Telenor Pakistan segment. Recoverable
\u00a0
amount of the assets was estimated to
\u00a0
be NOK 5.8 billion as of 30 June
2022. The impairment assessment, with several scenarios, was
\u00a0
updated as of year-end 2022 and no
\u00a0
further impairment was recognised. Telenor
Pakistan
\u00a0
is still
\u00a0
sensitive
\u00a0
for impairment.
\u00a0
The impairment
\u00a0
per class
\u00a0
of asset was
\u00a0
as follows:
NOK in million
2022
Property, plant and equipment
1 508
963
29
Total impairments
2 500
Key assumptions
\u00a0
applied
\u00a0
in the calculation
\u00a0
of value in
\u00a0
use for Telenor
\u00a0
Pakistan
\u00a0
as of 30 June
\u00a0
2022 are stated
\u00a0
in the table
\u00a0
below. During
\u00a0
the
assessment of Telenor Pakistan, several scenarios related
\u00a0
to timing and level of spectrum acquisitions, investment in
\u00a0
radio equipment and
operational efficiency were prepared. The assessment was
\u00a0
based on a weighting of scenarios reflecting
\u00a0
the mentioned sensitivities. The weighted
key assumptions
\u00a0
used in the
\u00a0
scenarios
\u00a0
are summarised
\u00a0
below.
Key assumptions
\u00a0
2022
Telenor Pakistan
Revenue growth during 2022-2027, percent
1
1.1
EBITDA growth during 2022-2027, percent
1
1.7
EBITDA margin growth from 2022-2027, percentage points
2
1.7
Capex/revenues in the terminal value, percent
13.5
WACC, percent
WACC used
\u00a0
in the testing
\u00a0
at year-end
\u00a0
2021, percent
Nominal growth in cash flow in terminal
\u00a0
value, percent
4.8
1)
Represents the compound annual growth rate during
\u00a0
the period.
\u00a0
2)
Represents annual growth during the period.
Telenor did not recognise any significant impairments
\u00a0
in 2021,
\u00a0
except for the impairment recognised
\u00a0
for Telenor Myanmar presented as
discontinued
\u00a0
operations,
\u00a0
see note
\u00a0
12.
Sensitive
\u00a0
cash-generating
\u00a0
units with significant
\u00a0
goodwill
Apart from DNA in Finland, the Group
\u00a0
believes that no reasonably possible change in any
\u00a0
of the key assumptions used for impairment testing
\u00a0
would
cause the
\u00a0
carrying
\u00a0
amounts of
\u00a0
the cash-generating
\u00a0
units with
\u00a0
significant
\u00a0
goodwill
\u00a0
to exceed
\u00a0
recoverable
\u00a0
amounts. The
\u00a0
recoverable
\u00a0
amount of DNA
has been estimated based on
\u00a0
discounted cash flows from current revenue streams and
\u00a0
the estimated recoverable amount exceeds the carrying
amount
\u00a0
by approximately NOK 9.5 billion. Key assumptions
\u00a0
used to determine recoverable amount of DNA
\u00a0
are listed in the table below:
Key assumptions
\u00a0
in 2022
DNA
Revenue growth during 2023-2025, per cent
1)
2.9
Revenue growth
\u00a0
in the year
\u00a0
used as basis
\u00a0
for calculation
\u00a0
of terminal
\u00a0
value ,
\u00a0
per cent
\u00a0
2.0
EBITDA growth during 2023-2025, per cent
1)
4.7
EBITDA margin growth from 2023 to 2025, percentage points
2)
0.6
EBITDA margin
\u00a0
in the year
\u00a0
used as basis
\u00a0
for calculation
\u00a0
of terminal
\u00a0
value, per
\u00a0
cent
37.0
Nominal growth in cash flow in terminal
\u00a0
value, per cent
2.3
Capex/revenues
\u00a0
in the terminal
\u00a0
value, per
\u00a0
cent
13.5
6.8
1)
Represents the compound annual growth rate during
\u00a0
the period.
\u00a0
2)
Represents annual growth during the period.
The Finnish
\u00a0
market has
\u00a0
historically
\u00a0
seen a relatively
\u00a0
high growth
\u00a0
in subscription
\u00a0
and traffic
\u00a0
revenues.
\u00a0
The expected
\u00a0
growth in
\u00a0
revenue and
\u00a0
EBITDA
for DNA reflects
\u00a0
expectations
\u00a0
of continued
\u00a0
upselling
\u00a0
of existing
\u00a0
customers following
\u00a0
the 5G rollout,
\u00a0
increased
\u00a0
market share
\u00a0
within the
\u00a0
business
segment and higher contribution from value added
\u00a0
services, supported by DNA\u2019s historical performance and
\u00a0
external sources of information. Real
GDP growth
\u00a0
in the Finnish
\u00a0
economy
\u00a0
is expected
\u00a0
to be between
\u00a0
1.5-2.0 %
\u00a0
per year
\u00a0
in the medium
\u00a0
to long-term
\u00a0
period, and
\u00a0
inflation
\u00a0
is expected
\u00a0
to be
at comparable level. Capex/revenues in terminal value represent
\u00a0
normal investment level after 5G roll-out
\u00a0
and is in line with historical levels
(excluding spectrum). Spectrum prices are assumed to
\u00a0
be in line with historical levels.
\u00a0
The following changes in key assumptions, in isolation,
\u00a0
would result in the recoverable amount being
\u00a0
approximately equal to the carrying amount.
Consequential
\u00a0
effects of
\u00a0
a change
\u00a0
in one key
\u00a0
assumption
\u00a0
on other
\u00a0
key assumptions
\u00a0
may occur.
\u00a0
Predicting
\u00a0
any interaction
\u00a0
between
\u00a0
them involves
significant
\u00a0
uncertainties
\u00a0
and judgements,
\u00a0
and thus
\u00a0
has not been
\u00a0
done. Changes
\u00a0
beyond those
\u00a0
described
\u00a0
below may
\u00a0
lead to impairment.
DNA
Decrease in annual revenue growth during 2023-2025
\u00a0
by 1.4 percentage points
Decerease
\u00a0
in revenue
\u00a0
growth in
\u00a0
the year
\u00a0
used as basis
\u00a0
for calculation
\u00a0
of terminal
\u00a0
value by
\u00a0
4.3 percentage
\u00a0
points
Decrease in annual EBITDA growth during 2023-2025 by
\u00a0
2.8 percentage points
Decrease in annual EBITDA margin growth from
\u00a0
2023 to 2025 by 1.3 percentage points
Decrease in EBITDA margin in the year used
\u00a0
as basis for calculation of terminal value by
\u00a0
4.2 percentage points
Increase
\u00a0
in WACC
\u00a0
by 1 percentage
\u00a0
points
Decrease
\u00a0
in nominal
\u00a0
growth in
\u00a0
cash flow
\u00a0
in terminal
\u00a0
value by
\u00a0
1.1 percentage
\u00a0
points
Increase in capex/revenues in the terminal value
\u00a0
by 3.4 percentage points
.
NOTE 19
Trade and other receivables
Accounting policies
Trade and other receivables are recognised at fair value including
\u00a0
directly attributable transaction costs and subsequently measured at
amortised cost using the effective interest rate method. A customer
\u00a0
contract asset is recognised when the revenue from contracts with
customers exceeds the amounts received,
\u00a0
for example when sale of handsets
\u00a0
or other customer equipment is recovered through future
subscription fee payments. Contract assets are transferred to trade receivables
\u00a0
when the rights to payment become unconditional, which
is normally when the invoice has been issued. Refer
\u00a0
to further information in note 3 Revenues.
Key judgments
\u00a0
and estimates
Trade receivables and contract assets are adjusted
\u00a0
for provision for impairment in accordance with
\u00a0
the expected credit loss model. The simplified
approach
\u00a0
is applied
\u00a0
measuring
\u00a0
the loss allowance
\u00a0
at an amount
\u00a0
equal to
\u00a0
lifetime
\u00a0
expected
\u00a0
credit losses.
\u00a0
Impairment
\u00a0
for expected
\u00a0
credit losses
\u00a0
is
assessed every reporting period and calculated by considering
\u00a0
the historic evidence of the level of
\u00a0
bad debt experienced for customer types and
the aging of the receivable balance.
Trade and other
\u00a0
receivables
NOK in millions
Category
2022
2021
Receivables
\u00a0
from contracts
\u00a0
with customers
15 245
15 490
Provision for expected credit losses on trade receivables
(894)
(998)
Total receivables from contracts with customers as of
\u00a0
31 December
FAAC
1)
14 352
14 492
Interest-bearing receivables
3)
35
1 051
Finance lease receivable
4)
458
423
Other non-interest-bearing
\u00a0
receivables
1 648
2 334
Provision for expected credit losses on other current
\u00a0
receivables
(13)
(15)
Total other current receivables as of 31 December
FAAC
1)
2 128
3 793
Contract asset
216
362
5)
85
71
Governmental taxes and duties
388
685
1 674
2 336
Total other current non-financial assets as of 31 December
NF
2)
2 362
3 455
Total trade and other receivables as of 31 December
18 842
21 739
1)
FAAC: Financial assets at amortised cost
2)
NF: Non-financial assets and liabilities
3)
In 2021, this includes the current portion of the deferred
\u00a0
sales consideration receivable from PPF Group for
\u00a0
the sale of shares in Telenor Serbia in 2018.
\u00a0
4)
See note 27 for more information
5)
Asset for the right to recover returned goods on settling
\u00a0
refund liabilities.
As of 31
\u00a0
December
\u00a0
2022, NOK
\u00a0
3.1 billion
\u00a0
(NOK 3.1
\u00a0
billion as
\u00a0
of 31 December
\u00a0
2021) of
\u00a0
trade and
\u00a0
other receivables
\u00a0
relates to
\u00a0
handset instalments
\u00a0
not
due within
\u00a0
one year.
Specification
\u00a0
of contract assets
NOK in millions
2022
2021
Balance as of 1 January
362
412
New contract assets during the period less
\u00a0
transfer to receivables
93
( 41)
Disposal
\u00a0
of subsidiaries
( 263)
-
Currency
\u00a0
and other
\u00a0
effects
24
( 9)
Balance as of 31 December
216
362
Specification
\u00a0
of provision for
\u00a0
expected credit
\u00a0
losses on trade
\u00a0
receivables
NOK in millions
2022
2021
Provision as of 1 January
( 998)
(1 268)
Change during the year - continuing operations
( 91)
111
Change during the year - discontinued operations
77
55
Disposal
\u00a0
of subsidiaries
131
-
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
-
49
Currency
\u00a0
and other
\u00a0
effects
( 13)
55
Provision as of 31 December
( 894)
( 998)
Realised losses for the year - continuing
\u00a0
operations
( 549)
( 629)
Realised losses for the year - discontinued
\u00a0
operations
( 137)
( 203)
Recovered amounts previously provided for - continuing operations
37
39
Recovered amounts previously provided for - discontinued operations
45
46
Specification
\u00a0
of the age distribution
\u00a0
of trade receivables
Past due on
\u00a0
the reporting
\u00a0
date in the
\u00a0
following periods:
NOK in millions
Carrying
amount
reporting date
60 days
90 days
180 days
365 days
More than
365 days
As of 31 December 2022
Trade receivables
15 245
12 567
1 077
263
135
324
347
532
Provision for expected
credit losses
\u00a0
on trade
receivables
( 894)
( 65)
( 42)
( 34)
( 45)
( 129)
( 218)
( 360)
Total trade receivables
14 352
12 502
1 035
229
89
194
130
172
As of 31 December 2021
Trade receivables
15 490
12 825
990
239
137
277
399
621
Provision for expected
credit losses
\u00a0
on trade
receivables
( 998)
( 101)
( 43)
( 45)
( 51)
( 135)
( 229)
( 394)
Total trade receivables
14 492
12 724
947
194
86
142
171
227
For the trade
\u00a0
and other
\u00a0
current receivables
\u00a0
that are
\u00a0
not impaired
\u00a0
or past due,
\u00a0
there are
\u00a0
no indicators
\u00a0
at the date
\u00a0
of the reporting
\u00a0
that the debtors
will not
\u00a0
be able
\u00a0
to meet their
\u00a0
payment obligations.
NOTE 20
Cash and cash equivalents
Accounting policies
Cash and cash equivalents include bank deposits,
\u00a0
fixed rate bonds and commercial papers with original maturity
\u00a0
of three months or less which are
readily convertible
\u00a0
to known
\u00a0
amount of
\u00a0
cash and
\u00a0
subject to
\u00a0
insignificant
\u00a0
risk.
Cash and cash
\u00a0
equivalents
NOK in millions
2022
2021
Cash in the
\u00a0
group\u2019s cash
\u00a0
pool systems
2 667
4 976
Cash outside
\u00a0
the group\u2019s
\u00a0
cash pool
\u00a0
systems
1)
7 262
9 777
Cash equivalents
2)
-
470
Total cash and cash equivalents in statement of financial position
9 929
15 223
Bank overdraft
\u00a0
(part of
\u00a0
cash in statement
\u00a0
of cash flows)
( 252)
( 102)
Total cash and cash equivalents in statement of cash
\u00a0
flows
9 677
15 121
1)
Includes restricted cash in Grameenphone of NOK 10
\u00a0
million as of 31 December 2022 (NOK 10 million
\u00a0
as of 31 December 2021).
2)
Related to fixed deposit placements with shorter than
\u00a0
3 months maturity in Digi and Telenor ASA in
\u00a0
2021.
Telenor
\u00a0
has established
\u00a0
cash pool
\u00a0
arrangements
\u00a0
where Telenor
\u00a0
ASA is the
\u00a0
account holder
\u00a0
and the other
\u00a0
companies
\u00a0
in the group
\u00a0
are sub-account
holders or
\u00a0
participants.
\u00a0
The cash
\u00a0
pool arrangements
\u00a0
allow netting
\u00a0
of cash positions
\u00a0
within the
\u00a0
group. Subsidiaries
\u00a0
in which Telenor
\u00a0
owns less
\u00a0
than
90% of the
\u00a0
shares are
\u00a0
normally
\u00a0
not participants
\u00a0
in the cash
\u00a0
pool arrangements
\u00a0
held by
\u00a0
Telenor ASA.
\u00a0
As of 31 December
\u00a0
2022 the major
\u00a0
part of the
cash and
\u00a0
cash equivalents
\u00a0
outside
\u00a0
the cash
\u00a0
pool arrangements
\u00a0
relates to
\u00a0
Telenor
\u00a0
ASA,
\u00a0
dtac and
\u00a0
Grameenphone.
\u00a0
For 2021
\u00a0
the major
\u00a0
part of the
cash and cash equivalents outside the cash
\u00a0
pool systems relates to Telenor ASA, dtac, Grameenphone
\u00a0
and Telenor Pakistan.
NOTE 21
Pension obligations
Telenor offer several different pension plans to its employees.
\u00a0
The most common pension plan is the defined
contribution plan where a contribution is made to the employee\u2019s individual
\u00a0
pension account. This arrangement is
in addition to the plans organised by governments providing
\u00a0
a basic pension entitlement to all taxpayers. Telenor
also has defined benefit plans with future pension obligations
\u00a0
that are mostly closed for new members.
Accounting policies
Defined contribution plans
A defined contribution plan is a type of
\u00a0
retirement plan where the employer makes contributions on
\u00a0
a regular basis to the employee\u2019s individual
pension account. The benefits received by the
\u00a0
employee are based on the employer contributions and gains
\u00a0
or losses from investing the capital.
Contributions
\u00a0
to defined contribution pension plans are recognised
\u00a0
as an expense in the income statement
\u00a0
as incurred.
Defined benefit plans
A defined benefit plan is a pension plan
\u00a0
where the employer promises an annual pension
\u00a0
on retirement based on a percentage of
\u00a0
the salary upon
retirement and the employee's earnings history, years
\u00a0
of service and age. The pension obligations are
\u00a0
determined by discounting the estimated
future pension
\u00a0
cash outflows
\u00a0
less the
\u00a0
fair value
\u00a0
of plan assets.
\u00a0
The discount
\u00a0
rate is based
\u00a0
on interest
\u00a0
rates of
\u00a0
high-quality
\u00a0
corporate
\u00a0
bonds
denominated in the same currency and with
\u00a0
similar maturity as the related pension obligation. The defined
\u00a0
benefit obligation is calculated annually
by independent
\u00a0
actuaries
\u00a0
using the
\u00a0
projected
\u00a0
unit credit
\u00a0
method.
Current and
\u00a0
past service
\u00a0
cost in
\u00a0
addition
\u00a0
to non-routine
\u00a0
pension settlements,
\u00a0
is presented
\u00a0
as salaries
\u00a0
and personnel
\u00a0
costs, and
\u00a0
the net interest
expense is recognised as financial expense in
\u00a0
the income statement. Remeasurements including actuarial gains and losses and
\u00a0
the return on plan
assets exceeding the discount rate are recognised
\u00a0
in the statement of comprehensive income and
\u00a0
are not subsequently reclassified to the income
statement.
A plan curtailment is when Telenor is committed
\u00a0
to reduce the number of employees in a
\u00a0
plan or change the terms, so the
\u00a0
employees are entitled
to reduced benefits or is no longer
\u00a0
eligible for benefits. Past service cost is recognised in
\u00a0
the income statement on the earlier of
\u00a0
the date of the plan
amendment
\u00a0
or curtailment
\u00a0
or when
\u00a0
the related
\u00a0
restructuring
\u00a0
cost is recognised.
\u00a0
Gains and
\u00a0
losses on
\u00a0
curtailments
\u00a0
form part
\u00a0
of service
\u00a0
cost and
\u00a0
are
presented
\u00a0
as part of
\u00a0
other income
\u00a0
or other expenses
\u00a0
in the income
\u00a0
statement.
\u00a0
Defined benefit multi-employer plans
\u00a0
(such as the AFP arrangement in
\u00a0
Norway) are accounted for as defined contribution
\u00a0
plans when insufficient
information
\u00a0
is available
\u00a0
to calculate
\u00a0
Telenor\u2019s
\u00a0
proportionate
\u00a0
share.
Key judgments
\u00a0
and estimates
The present value of the pension obligations
\u00a0
depends on a number of actuarial assumptions, including
\u00a0
the discount rate, expected salary growth,
inflation and return on assets as well
\u00a0
as demographical factors concerning mortality, employee turnover,
\u00a0
disability and early retirement.
Assumptions
\u00a0
about all
\u00a0
these factors
\u00a0
are based
\u00a0
on the situation
\u00a0
at the time
\u00a0
the assessment
\u00a0
is made,
\u00a0
whereas it
\u00a0
is expected
\u00a0
that such factors
\u00a0
will
change over
\u00a0
the long
\u00a0
periods for
\u00a0
which pension
\u00a0
calculations
\u00a0
are made.
\u00a0
Any changes
\u00a0
in these assumptions
\u00a0
will affect
\u00a0
the calculated
\u00a0
pension
obligations with immediate recognition in other comprehensive
\u00a0
income.
Significant pension
\u00a0
arrangements
\u00a0
in Telenor
Telenor
\u00a0
provides
\u00a0
pension plans
\u00a0
for employees
\u00a0
in Norway
\u00a0
which follow
\u00a0
the requirements
\u00a0
in the Act
\u00a0
on Mandatory
\u00a0
company pensions.
\u00a0
In addition,
the Norwegian government provides social security payments
\u00a0
to all retired Norwegian citizens. Such payments
\u00a0
are calculated by reference to a
base amount annually approved by the Norwegian
\u00a0
parliament (G-regulation). Benefits are determined based on
\u00a0
the employee\u2019s length of service
and compensation. The cost of pension benefit
\u00a0
plans is expensed over the period that
\u00a0
the employees render services and becomes eligible
\u00a0
to
Telenor Pension Fund, covering the defined benefit plans
\u00a0
offered to all employees in Norway, was closed to
\u00a0
new members during 2006 and
replaced by defined contribution plans with insurance companies.
\u00a0
In Norway, 3 575 of the employees
\u00a0
were members of the contribution plan as
\u00a0
of 31 December 2022 (3 383 as of 31 December
\u00a0
2021). In 2022, 1 022 of
the employees
\u00a0
were covered
\u00a0
by the defined
\u00a0
benefit plans
\u00a0
through Telenor
\u00a0
Pension Fund
\u00a0
(1 135 in
\u00a0
2021). In addition,
\u00a0
Telenor Pension
\u00a0
Fund paid
\u00a0
out
pensions to 2 516 persons in 2022 (2
\u00a0
475 in 2021). Telenor Sweden has
\u00a0
a defined benefit plan with 588 active
\u00a0
members in 2022 (614 in 2021). Other
companies outside Norway and Sweden primarily offer
\u00a0
contribution plans.
\u00a0
The funded
\u00a0
defined benefit
\u00a0
plans in Norway
\u00a0
have net
\u00a0
funds of
\u00a0
NOK 858
\u00a0
million as
\u00a0
of 31 December
\u00a0
2022 (NOK
\u00a0
618 million
\u00a0
in net funds
\u00a0
as of 31
December
\u00a0
2021). The
\u00a0
current service
\u00a0
cost was NOK
\u00a0
178 million
\u00a0
in 2022 (NOK
\u00a0
174 million
\u00a0
in 2021).
\u00a0
Net interest
\u00a0
income was
\u00a0
NOK 15 million
\u00a0
(interest
income of NOK 10 million in 2021).
\u00a0
Unfunded defined benefit plans have previously been
\u00a0
offered to executive employees. These plans are
\u00a0
now closed. As of 31 December 2022, the
net defined benefit liability recognised in the
\u00a0
statement
\u00a0
of financial position was NOK 636 million (NOK
\u00a0
684 million as of 31 December 2021). The
service cost was NOK 8 million in 2022 (NOK 8
\u00a0
million in 2021). Net interest cost was
\u00a0
NOK 13 million (NOK 11 million in
\u00a0
2021). Telenor does not have a
right to use the net funds in
\u00a0
the funded plans to settle the obligations
\u00a0
under the unfunded plans.
\u00a0
Telenor
\u00a0
is member
\u00a0
of an agreement-based
\u00a0
early retirement
\u00a0
plan (new
\u00a0
AFP) in Norway.
\u00a0
Essentially
\u00a0
all the Norwegian
\u00a0
employees
\u00a0
are entitled
\u00a0
to life-
long benefits
\u00a0
from the
\u00a0
age of 62
\u00a0
from this
\u00a0
plan, in
\u00a0
addition
\u00a0
to other plans.
\u00a0
The plan
\u00a0
is financed
\u00a0
through a
\u00a0
pooled arrangement,
\u00a0
where private
\u00a0
sector
employers cover 2/3 of the funding requirements
\u00a0
and the Norwegian government covers 1/3. For 2022,
\u00a0
the contribution was 2.6% of total salaries
between 1 and 7.1 times the base amount
\u00a0
(G) (2.5% for 2021). For
\u00a0
2023, the contribution is set to 2.6%.
\u00a0
The plan is considered to be a defined benefit
multi-employer plan with limited
\u00a0
funding and where plan assets are not
\u00a0
segregated. The information required to calculate a
\u00a0
proportionate share of
the plan,
\u00a0
and account
\u00a0
for the plan
\u00a0
as a defined
\u00a0
benefit plan,
\u00a0
is not available
\u00a0
from the
\u00a0
plan administrator.
\u00a0
Consequently,
\u00a0
the plan
\u00a0
is accounted
\u00a0
for as
a defined contribution plan.
\u00a0
The defined benefit plan in Sweden has a
\u00a0
net benefit liability of NOK 918 million
\u00a0
as of 31 December 2022 (NOK 1 372
\u00a0
million as of 31 December 2021).
The service cost was NOK 58 million
\u00a0
and net interest cost was NOK
\u00a0
29 million in 2022 (NOK 82 million and NOK 21
\u00a0
million in 2021, respectively). The
discount rate used for the pension calculations
\u00a0
as of 31 December 2022 was 3.9% (2.0% in 2021)
\u00a0
and expected salary increase was set to 3.0%
For the Norwegian defined benefit plans, the Group
\u00a0
applies the K2013 risk table for mortality and
\u00a0
a risk table for disability based on
\u00a0
historical figures
in Telenor
\u00a0
Pension Fund
\u00a0
(both implemented
\u00a0
in 2013).
\u00a0
The average
\u00a0
expected lifetime
\u00a0
in the risk
\u00a0
tables is 88
\u00a0
years for
\u00a0
men and 91
\u00a0
years for
\u00a0
women.
\u00a0
The table
\u00a0
below shows
\u00a0
the probability
\u00a0
of an employee
\u00a0
in a certain
\u00a0
age group
\u00a0
becoming
\u00a0
disabled
\u00a0
or dying,
\u00a0
within one
\u00a0
year, as
\u00a0
well as expected
lifetime.
Expected lifetime
Age
Men
Women
Men
Women
Men
Women
40
0.1
0.0
0.1
0.1
88
92
50
0.1
0.1
0.2
0.3
88
91
60
0.4
0.3
0.8
1.2
87
91
70
1.1
0.8
-
-
88
91
80
3.8
2.6
-
-
90
92
The plan assets were measured at fair
\u00a0
value 31 December 2022 and 31 December 2021. The calculation of
\u00a0
the projected benefit obligations (PBO) as
of 31 December 2022 was based on the
\u00a0
member base at 11 October 2022 (at 20 October 2021).
The actuarial
\u00a0
calculations
\u00a0
for the Telenor
\u00a0
Pension Fund
\u00a0
obligations
\u00a0
were carried
\u00a0
out by independent
\u00a0
actuaries.
\u00a0
The present
\u00a0
value of
\u00a0
the projected
defined
\u00a0
benefit obligation,
\u00a0
and the related
\u00a0
current service
\u00a0
cost and
\u00a0
past service
\u00a0
cost, were
\u00a0
measured
\u00a0
using the
\u00a0
projected
\u00a0
unit
\u00a0
credit method.
Employees in Norway that leave Telenor before the
\u00a0
age of retirement receive a paid-up
\u00a0
policy. Telenor Pension Fund administers some of
\u00a0
these
policies.
\u00a0
This is
\u00a0
at the discretion
\u00a0
of the Telenor
\u00a0
Pension Fund
\u00a0
and does not
\u00a0
affect Telenor.
\u00a0
At the time
\u00a0
of issuance
\u00a0
of a paid-up
\u00a0
policy, Telenor
\u00a0
is
relieved
\u00a0
of any further
\u00a0
obligations
\u00a0
towards the
\u00a0
receiver.
\u00a0
The funds
\u00a0
and obligations
\u00a0
are valued
\u00a0
at the time
\u00a0
of issuance
\u00a0
of paid-up
\u00a0
policies and
\u00a0
are
derecognised
\u00a0
from pension
\u00a0
obligations
\u00a0
and plan
\u00a0
assets.
Changes in the defined benefit obligation and fair value of plan assets
2022
2021
NOK in millions
Defined benefit
obligation
assets
Benefit liability
Defined benefit
obligation
assets
Benefit liability
As of 1 January
(10 432)
8 624
(1 808)
(10 231)
7 913
(2 318)
Current service
\u00a0
cost
( 307)
-
( 307)
( 337)
-
( 337)
-
-
-
26
-
26
Net interest
( 227)
185
( 42)
( 189)
155
( 34)
Discontinued
\u00a0
operations
-
-
-
-
-
-
Sub-total included in Income Statement
( 534)
185
( 349)
( 501)
155
( 345)
Return on
\u00a0
plan assets
\u00a0
(excluding
\u00a0
amounts
included in net interest expense)
-
( 632)
( 632)
-
327
327
Actuarial
\u00a0
changes arising
\u00a0
from changes
\u00a0
in
demographic
\u00a0
assumptions
( 31)
-
( 31)
( 10)
-
( 10)
Actuarial
\u00a0
changes arising
\u00a0
from changes
\u00a0
in
financial
\u00a0
assumptions
1 421
-
1 421
( 65)
-
( 65)
Experience
\u00a0
adjustments
1)
( 96)
-
( 96)
15
-
15
Sub-total in Other Comprehensive Income
1 294
( 632)
661
( 61)
327
266
Effects of
\u00a0
business combinations
\u00a0
and disposals
( 2)
1
( 1)
( 3)
-
( 3)
Contributions by employer
-
323
323
-
448
449
Benefits paid
380
( 304)
76
321
( 303)
18
Translation differences
65
( 26)
39
41
84
125
(9 230)
8 171
(1 059)
(10 432)
8 624
(1 808)
Of which
\u00a0
classified
\u00a0
as:
Pension obligations
(1 919)
(2 429)
Other non-current
\u00a0
assets
2)
859
620
1)
Telenor does not have a right to use the net funds
\u00a0
in the funded plans to settle the obligations under
\u00a0
the unfunded plans.
2)
Experience adjustments on benefit obligations are the
\u00a0
effects of differences between previous actuarial
\u00a0
assumptions and what has actually occurred.
Assumptions used to determine defined benefit obligations for Norwegian companies
\u00a0
as of 31 December
2022
2021
3.00
1.90
Future salary
\u00a0
increase
\u00a0
in %
3.00
2.50
Future increase
\u00a0
in the social
\u00a0
security
\u00a0
base amount
\u00a0
in %
3.25
2.50
Future turnover
\u00a0
in %
3.00
3.00
Future pension
\u00a0
increases
\u00a0
in %
2.00
1.75
Expected average remaining service period in years
7
7
Telenor has
\u00a0
used the
\u00a0
Norwegian
\u00a0
covered bonds
\u00a0
(OMF \u2013 Obligasjoner
\u00a0
med fortrinnsrett)
\u00a0
as basis
\u00a0
for the
\u00a0
discount rate
\u00a0
as of 31
\u00a0
December
\u00a0
for both
2022 and 2021 for the Norwegian plans. OMFs are
\u00a0
covered bonds issued by mortgage companies owned
\u00a0
by Norwegian banks under a well-
established legal framework. Generally, bonds with ratings better
\u00a0
than AA are considered to be of
\u00a0
high quality. Most OMFs have AAA rating.
Components of net periodic benefit cost
NOK in millions
2022
2021
Current service
\u00a0
cost
( 307)
( 337)
-
26
( 42)
( 34)
Net periodic benefit costs
( 349)
( 345)
Contribution
\u00a0
plan costs
( 707)
( 709)
Total pension costs charged to the income statement for the year
(1 056)
(1 054)
Of which reported as other expense (note
\u00a0
8)
\u00a0
( 10)
19
Of which
\u00a0
reported
\u00a0
as pension
\u00a0
cost (note
\u00a0
5)
(1 004)
(1 039)
Of which
\u00a0
reported
\u00a0
as net interest
\u00a0
cost (note
\u00a0
9)
( 42)
( 34)
Sensitivity
\u00a0
analysis
The table
\u00a0
below shows
\u00a0
an estimate
\u00a0
of the potential
\u00a0
effects of
\u00a0
changes in
\u00a0
the key
\u00a0
assumptions
\u00a0
for the
\u00a0
defined
\u00a0
benefit plans
\u00a0
in Norway.
\u00a0
The
following estimates are based on facts and circumstances
\u00a0
as of 31 December 2022.
\u00a0
Actual results may deviate materially from these
\u00a0
estimates.
NOK in millions
Future salary
\u00a0
increase
Social security
\u00a0
base
amounts
Annual adjustments
\u00a0
to
pensions
Turnover
Change in
\u00a0
% is percentage
\u00a0
points
-1%
+1%
-1%
+1%
-1%
+1%
-1%
+1%
-1%
+1%
Changes in:
Increase (decrease) in benefit obligations
1 279
( 989)
( 389)
389
89
( 132)
( 783)
936
42
( 84)
Asset categories
Telenor Pension Fund\u2019s weighted average asset allocations as
\u00a0
of 31 December, by asset category, were as
\u00a0
follows:
2022
2021
Bonds %
61
58
35
36
Other %
4
5
Total
100
100
The bond investments are in securities issued
\u00a0
by the Norwegian government, Norwegian municipals, financial institutions, and corporations. Bonds
held in foreign currencies are to a large
\u00a0
extent currency hedged. Equity investments are both
\u00a0
in Norwegian and foreign securities. There is no
currency hedging for investments in foreign equity
\u00a0
securities. The category Other consist mainly of
\u00a0
investments in Private Equity and Hedge fonds.
Contributions in future years
Expected contributions to the Telenor Pension Fund in
\u00a0
2023 is approximately NOK 288 million.
\u00a0
The following table shows expected benefit payments from
\u00a0
the Norwegian defined benefit plans in future years:
NOK in millions
Within the
\u00a0
next 12
\u00a0
months (next
\u00a0
annual reporting
\u00a0
period)
201
Between 2 and 5 years
906
Next 5 years
1 642
Total expected payments next 10 years
2 749
The average duration of the Norwegian defined benefit
\u00a0
plans at the end of the reporting
\u00a0
period is 15 years.
NOTE 22
Provisions and obligations
Telenor makes provisions for legal disputes when they become
\u00a0
probable and the amount can be reliably
estimated. Provisions are also made for asset retirement obligations
\u00a0
representing the removal and restoration
cost for infrastructure operated by Telenor. Other provisions relate to
\u00a0
restructuring costs and various onerous
contracts.
Accounting policies
Provisions such as for asset retirement obligations,
\u00a0
workforce reductions, onerous contracts and legal claims
\u00a0
are recognised when there is a
present legal
\u00a0
or constructive
\u00a0
obligation
\u00a0
as a result
\u00a0
of past events,
\u00a0
it is probable
\u00a0
that an outflow
\u00a0
of resources
\u00a0
will be
\u00a0
required
\u00a0
to settle
\u00a0
the obligation,
and the amount
\u00a0
can be reliably
\u00a0
estimated.
\u00a0
Provisions
\u00a0
are measured
\u00a0
at management\u2019s
\u00a0
best estimate
\u00a0
of the expenditure
\u00a0
required
\u00a0
to settle
\u00a0
the
obligation
\u00a0
at the reporting
\u00a0
date and
\u00a0
are discounted
\u00a0
to present
\u00a0
value. Asset
\u00a0
retirement
\u00a0
obligations
\u00a0
(ARO) primarily
\u00a0
relate to
\u00a0
base stations
\u00a0
and
installed
\u00a0
network and
\u00a0
infrastructure
\u00a0
equipment
\u00a0
in addition
\u00a0
to some buildings,
\u00a0
see note
\u00a0
17. The
\u00a0
net present
\u00a0
value of
\u00a0
the future
\u00a0
ARO is discounted
using a
\u00a0
pre-tax risk-free
\u00a0
rate as risks
\u00a0
are reflected
\u00a0
in the cash
\u00a0
flows. Upon
\u00a0
recognition
\u00a0
of an asset
\u00a0
retirement
\u00a0
obligation,
\u00a0
a corresponding
\u00a0
amount is
recognised
\u00a0
as an increase
\u00a0
of the related
\u00a0
asset within
\u00a0
property,
\u00a0
plant and
\u00a0
equipment
\u00a0
with subsequent
\u00a0
depreciation
\u00a0
over the useful
\u00a0
life of the
\u00a0
asset.
After the initial recognition, an accretion expense
\u00a0
is recognised as finance cost. Any subsequent
\u00a0
adjustments of the asset retirement obligation
from changes
\u00a0
of the removal
\u00a0
costs or discount
\u00a0
rates will
\u00a0
have a corresponding
\u00a0
adjustment
\u00a0
to the carrying
\u00a0
value of
\u00a0
the property,
\u00a0
plant and
equipment.
Key judgments
\u00a0
and estimates
Provisions
\u00a0
are estimated
\u00a0
based on
\u00a0
a number
\u00a0
of assumptions
\u00a0
and are
\u00a0
highly uncertain
\u00a0
in nature.
\u00a0
In particular,
\u00a0
the amounts
\u00a0
related
\u00a0
to legal
\u00a0
disputes
can be significant and the assessment of
\u00a0
probability and the possible outcome include highly
\u00a0
judgmental and complex assessments made by
management. Further, there is significant uncertainty related to
\u00a0
the timing of the asset retirement obligation
\u00a0
to occur, as the removal and
restoration of the sites will occur well into
\u00a0
the future and strategy, technological developments, markets
\u00a0
and other factors may impact the timing.
There is
\u00a0
also significant
\u00a0
uncertainty
\u00a0
related
\u00a0
to the asset
\u00a0
removal cost
\u00a0
due to uncertain
\u00a0
future price
\u00a0
development
\u00a0
and possibility
\u00a0
of negotiations
\u00a0
of
prices for
\u00a0
a large
\u00a0
number of
\u00a0
removals.
\u00a0
Further, there
\u00a0
is potentially
\u00a0
agreements
\u00a0
that relief
\u00a0
Telenor from
\u00a0
its obligations
\u00a0
and also uncertainty
\u00a0
as to
whether the
\u00a0
restoration
\u00a0
actually
\u00a0
will take
\u00a0
place. Due
\u00a0
to these uncertainties,
\u00a0
the actual
\u00a0
costs for
\u00a0
legal claims
\u00a0
and asset
\u00a0
retirement
\u00a0
obligations
\u00a0
may be
significantly
\u00a0
different
\u00a0
that current
\u00a0
estimates.
Non-current provisions
NOK in millions
2022
2021
Provision
\u00a0
for workforce
\u00a0
reductions
\u00a0
and onerous
\u00a0
(loss) contracts
\u00a0
334
195
Asset retirement obligations
\u00a0
6 092
7 526
Other provisions
201
250
Total non-current provisions and obligations as of 31 December
6 627
7 971
Current provisions
NOK in millions
2022
2021
Provisions
\u00a0
for workforce
\u00a0
reduction
\u00a0
and onerous
\u00a0
(loss) contracts
\u00a0
345
416
Asset retirement obligations
\u00a0
13
12
Other provisions
433
468
Total current provisions and obligations as of 31 December
791
896
Development
\u00a0
in provisions
The table below shows the development of
\u00a0
provisions during 2022. Provisions for legal disputes are
\u00a0
mainly recognised as trade and other payables
in the statement
\u00a0
of financial
\u00a0
position.
\u00a0
Provisions
\u00a0
made for
\u00a0
discontinued
\u00a0
operations
\u00a0
are disclosed
\u00a0
in note 12.
NOK in millions
Legal disputes
Asset retirement
obligations
contracts
As of 1 January
3 548
7 538
611
Obligations arising and effects of changes in estimates
\u00a0
during the year
952
(1 056)
729
-
147
-
Amounts utilised
( 102)
( 175)
( 656)
Other changes
\u00a0
and translation
\u00a0
difference
( 793)
18
( 4)
Reclassified
\u00a0
to liabilities
\u00a0
held for
\u00a0
sale
-
( 367)
-
As of 31 December
3 605
6 105
679
The increase in provisions during 2022 includes update of
\u00a0
provisions for regulatory disputes based on available
\u00a0
information from the outcome of
court proceedings in Grameenphone. See further information
\u00a0
in Note 23 Legal disputes and contingencies.
Asset retirement obligations
\u00a0
The reduction
\u00a0
in provisions
\u00a0
in 2022
\u00a0
is a result
\u00a0
of updated
\u00a0
estimates
\u00a0
on timing
\u00a0
before expected
\u00a0
removals
\u00a0
and restorations
\u00a0
are expected
\u00a0
to occur.
\u00a0
Workforce reduction
\u00a0
Provisions for workforce reductions included about 570
\u00a0
employees as of 31 December 2022 compared to
\u00a0
about 650 employees the year before.
NOTE 23
Legal disputes and contingencies
Telenor is subject to various legal proceedings, disputes and claims including
\u00a0
regulatory discussions related to its
business, licences and investments. Management makes
\u00a0
a provision for legal disputes when an unfavourable
outcome is probable and a reliable estimate can be made. The
\u00a0
most significant legal disputes are summarised in
Accounting policies
Legal disputes
\u00a0
are usually
\u00a0
contingent
\u00a0
in nature,
\u00a0
meaning
\u00a0
the possible
\u00a0
obligation
\u00a0
depends
\u00a0
on future
\u00a0
events outside
\u00a0
the company\u2019s
\u00a0
control,
\u00a0
for
example a court decision. Provisions are made
\u00a0
for legal claims where an unfavorable
\u00a0
outcome is probable and the amount required to
\u00a0
settle the
dispute can be reliably estimated. Provisions are based on
\u00a0
management\u2019s best estimate of the amount required
\u00a0
to settle the obligation discounted
Key judgments
\u00a0
and estimates
There is significant uncertainty related to predicting
\u00a0
the outcome of legal proceedings, disputes and claims. The
\u00a0
potential obligations can represent
significant
\u00a0
amounts, the
\u00a0
disputes
\u00a0
may involve
\u00a0
complex assessments
\u00a0
of contracts
\u00a0
and legislation,
\u00a0
and political
\u00a0
and country
\u00a0
risk is
\u00a0
high in certain
disputes. Due to these uncertainties, the future
\u00a0
actual costs for legal disputes may be
\u00a0
significantly different than current estimates. Management
evaluates the degree of probability of
\u00a0
an unfavourable outcome and the ability to
\u00a0
make a reasonable estimate of the amount
\u00a0
of loss. Unanticipated
events or
\u00a0
changes
\u00a0
in these
\u00a0
factors may
\u00a0
require
\u00a0
management
\u00a0
to accrue
\u00a0
for a matters
\u00a0
that become
\u00a0
probable
\u00a0
or reliable,
\u00a0
or change
\u00a0
a provision
accrued for in a previous reporting period.
Significant
\u00a0
legal proceedings,
\u00a0
claims and
\u00a0
regulatory discussions
Significant legal proceedings, claims and regulatory discussions are
\u00a0
summarised below. Some of the cases include a statement
\u00a0
that a provision has
been made.
\u00a0
Cases that
\u00a0
do not state
\u00a0
that a provision
\u00a0
has been
\u00a0
made either
\u00a0
(a) do not
\u00a0
have a provision
\u00a0
and the matter
\u00a0
is treated
\u00a0
as a contingent
liability; or (b) a provision has been established but
\u00a0
the fact has not been disclosed
\u00a0
as it can seriously prejudice our position.
\u00a0
Disclosing that a
provision
\u00a0
has been
\u00a0
made to the
\u00a0
counterparty
\u00a0
would reveal
\u00a0
the fact that
\u00a0
Telenor
\u00a0
believes
\u00a0
it is probably
\u00a0
that a cash
\u00a0
outflow will
\u00a0
occur and
\u00a0
that that
\u00a0
an
amount can be reliably estimated. While acknowledging the
\u00a0
uncertainties related to these matters, management is
\u00a0
of the opinion that based on the
information currently available, these matters will be
\u00a0
resolved without any material financial adverse effect individually
\u00a0
or in aggregate.
\u00a0
See note 10
for further information about tax claims and
\u00a0
uncertain tax positions.
\u00a0
See note 22 for further information about
\u00a0
development in legal dispute
Grameenphone,
\u00a0
Bangladesh
The Bangladesh Telecommunications Regulatory Commission (BTRC) has
\u00a0
over several years conducted an information system
\u00a0
audit of
Grameenphone for the period 1997 to 2014.
\u00a0
On 2 April 2019, Grameenphone received a demand
\u00a0
notice from BTRC for payment of NOK
\u00a0
8.1 billion to
BTRC (NOK 2.2 billion in principal and NOK
\u00a0
5.9
\u00a0
billion in interest), including some matters pending
\u00a0
in ongoing formal resolution processes (sub-
judice). These claims are unjustified from Telenor\u2019s
\u00a0
and Grameenphone\u2019s position. In addition, BTRC has
\u00a0
unauthorised and erroneously claimed
NOK 3.9 billion,
\u00a0
which mainly
\u00a0
is related
\u00a0
to an already
\u00a0
resolved
\u00a0
matter and
\u00a0
other sub-judice
\u00a0
matters with
\u00a0
the National
\u00a0
Board of
\u00a0
Revenue (NBR).
\u00a0
The
total demand
\u00a0
amounts to
\u00a0
NOK 12.0
\u00a0
billion (the
\u00a0
Demand).
\u00a0
Overall,
\u00a0
the Demand
\u00a0
is based
\u00a0
on allegations
\u00a0
that Grameenphone
\u00a0
has, amongst
\u00a0
other
things, underpaid
\u00a0
various taxes,
\u00a0
such as corporate
\u00a0
taxes, SIM
\u00a0
tax, VAT,
\u00a0
and revenue
\u00a0
share from
\u00a0
its mobile
\u00a0
operation.
\u00a0
The Demand
\u00a0
is comprised
\u00a0
of
claims against 26 line items, of which 22 line items are
\u00a0
related to BTRC matters and no provision
\u00a0
has been recorded based on the Demand
\u00a0
dated 2
April 2019, as such. The other four
\u00a0
line items are related to the NBR matters,
\u00a0
where Telenor and Grameenphone in previous years
\u00a0
have recorded
provisions
\u00a0
based on
\u00a0
an assessment
\u00a0
of the legal
\u00a0
merits of
\u00a0
the claims.
\u00a0
On 22 July
\u00a0
2019, BTRC
\u00a0
imposed
\u00a0
operational
\u00a0
restrictions
\u00a0
on Grameenphone
\u00a0
by stopping
\u00a0
No Objection
\u00a0
Certificates
\u00a0
(NOCs) and
\u00a0
approvals
\u00a0
on import
of products,
\u00a0
services,
\u00a0
and equipment.
\u00a0
Late August
\u00a0
2019, Grameenphone
\u00a0
filed both
\u00a0
a civil case
\u00a0
(title suit)
\u00a0
to the District
\u00a0
Court contesting
\u00a0
the
Demand and
\u00a0
an injunction
\u00a0
application
\u00a0
with a request
\u00a0
to stay the
\u00a0
suspension
\u00a0
of NOCs and
\u00a0
to restrain
\u00a0
BTRC from
\u00a0
taking any
\u00a0
steps in enforcing
\u00a0
the
Demand. The District Court rejected the application
\u00a0
for injunction. Grameenphone appealed before the High
\u00a0
Court Division (HCD) on 17 September
2019. On 17 October 2019, HCD passed
\u00a0
an injunction order restraining BTRC, for a
\u00a0
period of two months, from taking any
\u00a0
steps to realise or enforce
the Demand and suspend NOCs for import
\u00a0
of equipment/software and approvals of tariff/service
\u00a0
packages etc. (the \u201cHCD order\u201d). The HCD order
was appealed by BTRC to the Appellate Division
\u00a0
of the Supreme Court (AD) and on
\u00a0
24 November 2019 the AD decided that
\u00a0
the HCD order shall be
maintained, subject to payment
\u00a0
of NOK 1.9 billion by Grameenphone; otherwise,
\u00a0
the HCD order would stand vacated.
\u00a0
On 20 and 24 February 2020, the AD
\u00a0
ordered the payment of the deposit of
\u00a0
NOK 1.9 billion to BTRC to be
\u00a0
made in two equal instalments within 24
February 2020 and 31 May 2020. Both instalments
\u00a0
were paid before the due dates and recognised
\u00a0
as non-current financial assets (see note 27).
Further, AD directed BTRC to allow Grameenphone
\u00a0
to carry on its business without any
\u00a0
hindrance and fixed the matter on 31
\u00a0
May 2020 for passing
further order.
\u00a0
Due to the
\u00a0
COVID-19 situation
\u00a0
in Bangladesh,
\u00a0
the meeting
\u00a0
was postponed,
\u00a0
and no new
\u00a0
date has
\u00a0
been set.
\u00a0
BTRC has
\u00a0
lifted the
operational
\u00a0
restrictions
\u00a0
on the import
\u00a0
of equipment/software
\u00a0
and approvals
\u00a0
of tariff/service
\u00a0
packages etc.
\u00a0
The original
\u00a0
Title suit,
\u00a0
where the
\u00a0
court is
supposed
\u00a0
to assess
\u00a0
the merits
\u00a0
of the Demand,
\u00a0
is pending
\u00a0
at the District
\u00a0
Court. BTRC
\u00a0
submitted
\u00a0
their response
\u00a0
in the title
\u00a0
suit in District
\u00a0
Court 26
May 2022. The court requested the parties to
\u00a0
respond to the commencement of a possible
\u00a0
mediation process, pursuant to local law.
One of the
\u00a0
claims that
\u00a0
BTRC has
\u00a0
presented
\u00a0
to Grameenphone
\u00a0
in the BTRC-case
\u00a0
is related
\u00a0
to a dispute
\u00a0
as to how
\u00a0
VAT on the
\u00a0
payment of
\u00a0
2G license
fee shall be handled. The dispute is whether VAT
\u00a0
is included in the license fee or excluded
\u00a0
and thereby needs to be added and
\u00a0
paid separately.
\u00a0
The
claim represents an exposure of NOK 0.8
\u00a0
billion, excluding interests and penalty. Grameenphone was
\u00a0
under legal obligation to deduct 15% VAT at
source from the payment to BTRC, however
\u00a0
BTRC stipulated in the License Renewal Guideline
\u00a0
to make payment without any deduction. In
\u00a0
2011 the
mobile operators in Bangladesh challenged the new
\u00a0
guideline before the High Court Division. The
\u00a0
High Court Division has directed
\u00a0
Grameenphone
to pay 100%
\u00a0
of the license
\u00a0
fee to BTRC,
\u00a0
15% VAT
\u00a0
to the NBR
\u00a0
and thereafter
\u00a0
exercise
\u00a0
a rebate
\u00a0
right for
\u00a0
VAT. However,
\u00a0
the rebate
\u00a0
was denied
\u00a0
by NBR
due to BTRC not being VAT registered.
\u00a0
Grameenphone, BTRC and NBR filed appeals against
\u00a0
the verdict before the Appellate Division of the
Supreme Court
\u00a0
(AD) on
\u00a0
various grounds.
\u00a0
The hearing started on 26 July 2022 before
\u00a0
the AD and the verbal judgement was
\u00a0
pronounced on 10 January 2023, disallowing the
\u00a0
appeal of
Grameenphone and allowing the appeals of NBR
\u00a0
(challenging the judgement of Grameenphone\u2019s rebate right).
\u00a0
Moreover, the appeal of BTRC
(challenging the judgement relating to declaring imposition
\u00a0
of Market Competition Factor on Spectrum Assignment
\u00a0
in 2008 as illegal) has been
disposed of, which will be clarified when the
\u00a0
written judgement is available. Upon receiving written judgement,
\u00a0
Grameenphone will take necessary
steps subject for further assessment including the
\u00a0
relevant parts of BTRC audit demands.
Singapore and Bangladesh have entered a Bilateral
\u00a0
Investment Treaty (BIT) and in October 2019,
\u00a0
Telenor Asia Pte Ltd, a Telenor subsidiary
\u00a0
being a
shareholder in Grameenphone and domiciled in Singapore, sent
\u00a0
a notice to the President of Bangladesh
\u00a0
to initiate discussions as a first step in
\u00a0
an
attempt to
\u00a0
resolve issues
\u00a0
arising
\u00a0
from the audit
\u00a0
dispute between
\u00a0
Grameenphone
\u00a0
and BTRC
\u00a0
pursuant
\u00a0
to the procedural
\u00a0
mechanisms
\u00a0
in such BIT.
\u00a0
As set out above, Telenor\u2019s and Grameenphone\u2019s
\u00a0
position is that the BTRC claims are
\u00a0
unjustified. Grameenphone has performed a detailed
assessment and obtained legal advice for each
\u00a0
of the line items in the Demand. The
\u00a0
errors in the BTRC audit-findings,
\u00a0
the unprecedented long
period covered by the audit (more than
\u00a0
20 years backwards), the inclusion of already
\u00a0
settled/resolved items, the erroneous claim on behalf of
\u00a0
third
parties and the inclusion of sub-judice
\u00a0
items in conjunction with the absence of
\u00a0
merit based determination through any solution process,
\u00a0
create
significant
\u00a0
uncertainty
\u00a0
about the
\u00a0
validity
\u00a0
of the demand
\u00a0
and outcome
\u00a0
of the dispute.
SIM tax on replacement SIM cards
The Large Taxpayer Unit-VAT has issued three notices to
\u00a0
Grameenphone claiming SIM tax of in total
\u00a0
NOK 1.4 billion (excl. interest) on the
replacement of SIM cards issued during three time
\u00a0
periods from July 2007 to June 2015. In
\u00a0
2019 and 2020, the VAT Appellate Tribunal gave
decisions
\u00a0
in Grameenphone\u2019s
\u00a0
disfavour
\u00a0
in two of
\u00a0
the three
\u00a0
periods (2007-2011
\u00a0
and July
\u00a0
2012-June
\u00a0
2015), representing
\u00a0
a total demand
\u00a0
of NOK 1.3
billion
\u00a0
(excl. interest).
\u00a0
Grameenphone
\u00a0
has appealed
\u00a0
the decisions
\u00a0
to the High
\u00a0
Court Division
\u00a0
of the Supreme
\u00a0
Court who
\u00a0
passed stay
\u00a0
orders on
\u00a0
these
two decisions
\u00a0
by the Tribunal
\u00a0
until final
\u00a0
adjudication.
Dtac, Thailand
Revenue share and deduction of interconnect expenses in dtac (Thailand)
In January 2021,
\u00a0
the two Thailand\u2019s state-owned telecom
\u00a0
companies TOT Public Company Limited (TOT) and CAT
\u00a0
Telecom Public Company Limited
(CAT) merged and became National Telecom Public
\u00a0
Company Limited (NT). The disputes mentioned below
\u00a0
were initiated prior to the merger, as
disputes
\u00a0
with CAT,
\u00a0
but as a
\u00a0
result of
\u00a0
the merger,
\u00a0
NT is now
\u00a0
dtac\u2019s counterpart
\u00a0
in these
\u00a0
proceedings.
\u00a0
Dtac is
\u00a0
involved
\u00a0
in industry
\u00a0
disputes
\u00a0
with NT related
\u00a0
to the calculation
\u00a0
of revenue
\u00a0
share in
\u00a0
the now
\u00a0
expired
\u00a0
concession.
\u00a0
The issue
\u00a0
of the disputes
\u00a0
is
whether dtac
\u00a0
had the right
\u00a0
to deduct
\u00a0
interconnect
\u00a0
expenses
\u00a0
from its
\u00a0
interconnect
\u00a0
revenues to
\u00a0
be used
\u00a0
as basis
\u00a0
for calculating
\u00a0
the payment
\u00a0
of
concession
\u00a0
fee to NT.
\u00a0
Since late
\u00a0
December
\u00a0
2019, various
\u00a0
arbitration
\u00a0
panels have
\u00a0
made decisions
\u00a0
in dtac\u2019s
\u00a0
favor and
\u00a0
disfavor
\u00a0
for
\u00a0
concession
\u00a0
years
16 to 20.
\u00a0
Pursuant to these awards, dtac
\u00a0
has an obligation to pay an approximate total
\u00a0
amount of NOK 5.3 billion. Dtac has
\u00a0
appealed the negative
awards to
\u00a0
the Central
\u00a0
Administrative
\u00a0
Court. For
\u00a0
the disputes
\u00a0
related
\u00a0
to concession
\u00a0
years 21
\u00a0
to 27 (16
\u00a0
September
\u00a0
2011 to 15
\u00a0
September
\u00a0
2018),
\u00a0
NT has
previously
\u00a0
presented
\u00a0
claims of
\u00a0
NOK 4.5 billion
\u00a0
in total
\u00a0
(excl. penalty
\u00a0
and interest).
\u00a0
During second
\u00a0
quarter 2022,
\u00a0
the Arbitral
\u00a0
Tribunal
\u00a0
allowed NT
\u00a0
to
increase the claimed amount by NOK 0.4 billion,
\u00a0
since interconnect revenues dtac received from other
\u00a0
telecom operators was higher than the
amounts stated
\u00a0
in NT\u2019s statement
\u00a0
of claim.
Revenue share - deduction of excise tax
On 11 January
\u00a0
2008, National
\u00a0
Telecom PCL
\u00a0
(NT) submitted
\u00a0
a claim to
\u00a0
the Arbitration
\u00a0
Institute
\u00a0
in Thailand
\u00a0
requesting
\u00a0
dtac to make
\u00a0
concession
revenue sharing payments for the concession period
\u00a0
16 September 2002 to 15 September 2006 amounting
\u00a0
to NOK 6.6 billion including VAT and
penalties.
\u00a0
The basis
\u00a0
for the claim
\u00a0
is that revenue
\u00a0
share paid
\u00a0
by dtac to
\u00a0
NT was made
\u00a0
after deduction
\u00a0
of excise
\u00a0
tax. Dtac\u2019s
\u00a0
opinion is
\u00a0
that it was
entitled to deduct excise tax pursuant to
\u00a0
resolutions made by the Thai Council of
\u00a0
Ministers on 11 February 2003 and a letter issued
\u00a0
by NT on 27
March 2003. On 28 May 2012, the Thai Arbitral
\u00a0
Tribunal rendered an award in favor of dtac and
\u00a0
dismissed NT's claim. However, on 31 August
\u00a0
2012,
NT filed a lawsuit with the Central Administrative Court
\u00a0
in Thailand in order to revoke the Arbitral
\u00a0
Tribunal's award. On 29 January 2016, dtac was
notified
\u00a0
by the Central
\u00a0
Administrative
\u00a0
Court in
\u00a0
Thailand
\u00a0
that the court
\u00a0
had decided
\u00a0
the case
\u00a0
in dtac's
\u00a0
favor. NT
\u00a0
appealed
\u00a0
the case to
\u00a0
the Supreme
Administrative Court in Thailand. On 10 January 2023,
\u00a0
the Supreme Administrative Court uphold the judgement of
\u00a0
the Administrative Court of First
Instance to dismiss CAT\u2019s statement of claim
\u00a0
to revoke the arbitral award requested. The case
\u00a0
is thereby closed in dtac\u2019s favour.
Foreign ownership
One of dtac's competitors made a number
\u00a0
of complaints to the Thai Police and the Thai
\u00a0
Ministry of Commerce early in 2011, that dtac
\u00a0
is in breach of
the Foreign Business Act (FBA) limiting foreign
\u00a0
ownership to 49% of the share capital
\u00a0
without special governmental permission.
\u00a0
In addition,
\u00a0
on 22 September
\u00a0
2011, one
\u00a0
of dtac's
\u00a0
minority
\u00a0
shareholders
\u00a0
(holding
\u00a0
100 shares
\u00a0
in dtac)
\u00a0
filed a complaint
\u00a0
against the
\u00a0
state agency,
National Broadcasting and Telecommunication Commission (NBTC), with
\u00a0
the Central Administrative Court in Thailand alleging
\u00a0
that NBTC (as an
administrative agency) has negligently failed to perform
\u00a0
its duties in allowing dtac to operate its
\u00a0
telecom business. The Central Administrative
Court in Thailand has issued a summons
\u00a0
requesting dtac to become
\u00a0
a co-defendant in these proceedings. On
\u00a0
26 November 2015, the Central
Administrative
\u00a0
Court in
\u00a0
Thailand
\u00a0
ruled that
\u00a0
the court
\u00a0
cannot revoke
\u00a0
dtac's right
\u00a0
to operate.
\u00a0
However,
\u00a0
the court
\u00a0
has ordered
\u00a0
NBTC to investigate
whether dtac
\u00a0
is in breach
\u00a0
of the FBA.
\u00a0
Both NBTC
\u00a0
and dtac
\u00a0
have filed
\u00a0
an appeal
\u00a0
to the Supreme
\u00a0
Administrative
\u00a0
Court in
\u00a0
Thailand.
Currently, these two cases are under the
\u00a0
consideration of the Royal Thai Police and
\u00a0
the Supreme Administrative Court in Thailand. Telenor believes
that the
\u00a0
ownership structure in dtac was and still
\u00a0
is in accordance with Thai law as well as
\u00a0
established practices in Thailand.
\u00a0
India
Licences and spectrum
Telenor\u2019s
\u00a0
previous
\u00a0
operations
\u00a0
in India
\u00a0
are subject
\u00a0
to a number
\u00a0
of disputes
\u00a0
with the
\u00a0
Indian Department
\u00a0
of Telecommunications
\u00a0
(DoT), which
\u00a0
remain
to be concluded.
\u00a0
Telenor has
\u00a0
provided
\u00a0
guarantees
\u00a0
for certain
\u00a0
claims to
\u00a0
the current
\u00a0
owner Bharti
\u00a0
Airtel. Refer
\u00a0
to note 12
\u00a0
Held for
\u00a0
sale and
discontinued operations for further information about the
\u00a0
guarantee and provisions related to the period Telenor
\u00a0
owned the business in India.
\u00a0
One of the
\u00a0
disputes
\u00a0
relate to
\u00a0
the basis
\u00a0
for calculation
\u00a0
of licence
\u00a0
fees and spectrum
\u00a0
usage charges
\u00a0
for the entire
\u00a0
duration
\u00a0
of Telenor\u2019s
\u00a0
operations
\u00a0
in
India.
\u00a0
DoT has issued several revised and new
\u00a0
demand notices in the mentioned matter against Telenor\u2019s
\u00a0
Indian subsidiaries during the last years. In
a ruling
\u00a0
in the fourth
\u00a0
quarter of
\u00a0
2019 and
\u00a0
in subsequent
\u00a0
court orders
\u00a0
in 2020,
\u00a0
the Supreme
\u00a0
Court of India
\u00a0
upheld DoT\u2019s
\u00a0
view on the
\u00a0
determination
\u00a0
of
the licence fees and spectrum usage. These rulings
\u00a0
have bearing on demands amounting to approximately NOK
\u00a0
3.5 billion. Interest accruals on
demand notices
\u00a0
received
\u00a0
will apply
\u00a0
and are
\u00a0
currently
\u00a0
estimated
\u00a0
to NOK 0.9
\u00a0
billion for
\u00a0
demand notices
\u00a0
covered by
\u00a0
the Supreme
\u00a0
Court orders.
\u00a0
For
demand notices received, not covered by the
\u00a0
Supreme Court orders, there are ongoing reviews
\u00a0
performed by DoT and continued dialog between
Telenor and DoT. Telenor has settled NOK
\u00a0
0.5 billion of the mentioned demands.
\u00a0
On 2 February 2012, the Indian Supreme
\u00a0
Court quashed (cancelled) all 122 2G licences awarded in 2008,
\u00a0
including those granted to Telenor
subsidiary at the time, Unitech Wireless. The
\u00a0
Indian Supreme Court ordered that all such
\u00a0
2G licences and spectrum should be auctioned. The
spectrum auction was completed in November 2012 and Telenor,
\u00a0
through Telewings, secured spectrum licences in 6 circles.
\u00a0
In February 2013, the
Indian Supreme Court ordered the payment of
\u00a0
retroactive spectrum fees for the licences quashed
\u00a0
in February 2012. DoT issued a notice
\u00a0
in
November
\u00a0
2014 to
\u00a0
Unitech Wireless
\u00a0
seeking
\u00a0
an explanation
\u00a0
as to why
\u00a0
retrospective
\u00a0
spectrum
\u00a0
fee payment
\u00a0
should not
\u00a0
be recovered
\u00a0
by DoT
pursuant to the February 2013 order of
\u00a0
the Indian Supreme Court. Telenor replied to the
\u00a0
above notice in December 2014. However, on
\u00a0
14 February
2017,
\u00a0
DoT issued
\u00a0
a demand
\u00a0
notice of
\u00a0
NOK 0.9 billion
\u00a0
(including
\u00a0
interest).
\u00a0
Telenor
\u00a0
has challenged
\u00a0
such demand
\u00a0
and the interpretation
\u00a0
by DoT of
\u00a0
the
Indian Supreme Court judgment before the Telecom
\u00a0
Disputes Settlement and Appellate Tribunal in India.
\u00a0
A stay order is currently in place.
\u00a0
DoT has further
\u00a0
issued a
\u00a0
notice to
\u00a0
8 entities
\u00a0
of Unitech
\u00a0
Wireless
\u00a0
relating
\u00a0
to a financial
\u00a0
penalty of
\u00a0
NOK 1.3 billion
\u00a0
imposed, due
\u00a0
to an alleged
\u00a0
violation
of a merger
\u00a0
approval
\u00a0
for the Unitech
\u00a0
Wireless
\u00a0
entities.
\u00a0
Telenor has
\u00a0
contested
\u00a0
the basis
\u00a0
for the claim.
Telenor Pakistan
Licence renewal
Telenor
\u00a0
Pakistan\u2019s
\u00a0
900 MHz
\u00a0
and 1800
\u00a0
MHz spectrum
\u00a0
licence
\u00a0
expired on
\u00a0
25 May 2019,
\u00a0
and the renewal
\u00a0
fee was
\u00a0
set to NOK
\u00a0
4.0 billion
\u00a0
by the Pakistan
Telecommunication Authority (PTA) for an extension period
\u00a0
of 15 years. Telenor Pakistan disagreed with
\u00a0
the terms and conditions for renewal,
primarily
\u00a0
on the price.
\u00a0
Telenor Pakistan
\u00a0
believed
\u00a0
that the renewal
\u00a0
price should
\u00a0
be NOK 2.5
\u00a0
billion, which
\u00a0
is the same
\u00a0
as for prior
\u00a0
renewals
\u00a0
for other
operators. Accordingly, Telenor Pakistan challenged the terms
\u00a0
and conditions for renewal of said licence in
\u00a0
Islamabad High Court.
\u00a0
On 19 July
\u00a0
2021, the
\u00a0
High Court
\u00a0
decided
\u00a0
the case
\u00a0
in Telenor
\u00a0
Pakistan\u2019s
\u00a0
disfavour.
\u00a0
Telenor
\u00a0
Pakistan
\u00a0
appealed
\u00a0
the case
\u00a0
to the Supreme
\u00a0
Court on 31
August 2021. In December 2021, Telenor Pakistan signed
\u00a0
the licence under protest whilst waiting for the
\u00a0
Supreme Court\u2019s hearing of the case. On
\u00a0
25
May 2022,
\u00a0
the Supreme
\u00a0
Court rejected
\u00a0
the appeal.
\u00a0
The right-of-use
\u00a0
asset and
\u00a0
lease liability
\u00a0
related to
\u00a0
this licence
\u00a0
has been
\u00a0
adjusted
\u00a0
accordingly,
see further information in note 16.
\u00a0
Telenor Pakistan is still waiting for the
\u00a0
written Supreme Court decision and will assess
\u00a0
to file a review petition.
Telenor
\u00a0
Pakistan
\u00a0
has paid
\u00a0
a total of
\u00a0
NOK 2.8 billion
\u00a0
(USD 359
\u00a0
million excl.
\u00a0
interest)
\u00a0
of the demanded
\u00a0
license renewal
\u00a0
fees. See
\u00a0
note 18 for
\u00a0
further
information
\u00a0
about impairment
\u00a0
of Pakistan
\u00a0
following
\u00a0
the Supreme
\u00a0
Court ruling.
ESA
EFTA Surveillance Authority (ESA) and the Norwegian
\u00a0
Competition Authority (NCA) initiated an inspection of
\u00a0
Telenor Norge AS on 4 December 2012
based on
\u00a0
the suspected
\u00a0
abuse of
\u00a0
a dominant
\u00a0
position and/or
\u00a0
anti-competitive
\u00a0
collaboration
\u00a0
in the Norwegian
\u00a0
mobile market.
\u00a0
On 29 June
\u00a0
2020 ESA
issued a
\u00a0
decision
\u00a0
against Telenor
\u00a0
Norway and
\u00a0
Telenor
\u00a0
ASA with
\u00a0
a fine of
\u00a0
NOK 1.2
\u00a0
billion for
\u00a0
abuse of
\u00a0
dominant position
\u00a0
in Norway.
\u00a0
The investigation
has covered
\u00a0
a number
\u00a0
of issues,
\u00a0
but the
\u00a0
final decision
\u00a0
only concerns
\u00a0
the alleged
\u00a0
insufficient
\u00a0
margins between
\u00a0
Telenor\u2019s
\u00a0
wholesale
\u00a0
prices and
prices for
\u00a0
mobile broadband
\u00a0
to residential
\u00a0
customers
\u00a0
when sold
\u00a0
on a stand-alone
\u00a0
basis between
\u00a0
2008 and
\u00a0
2012. The
\u00a0
case rests
\u00a0
on a number
\u00a0
of
legal, economic, and factual considerations, on which
\u00a0
ESA and Telenor have different opinions. Telenor
\u00a0
has paid the fine in accordance with the
obligation
\u00a0
in the decision.
\u00a0
Telenor appealed
\u00a0
the decision
\u00a0
to the EFTA
\u00a0
Court on 28
\u00a0
August 2020.
\u00a0
On 5 May
\u00a0
2022, the
\u00a0
EFTA Court
\u00a0
rejected
\u00a0
Telenor\u2019s
appeal and
\u00a0
the case
\u00a0
is thereby
\u00a0
final and
\u00a0
closed.
NOTE 24
Trade and other payables
\u00a0
Accounting policies
Trade and other payables relate to amounts
\u00a0
owed to suppliers and customer contract liabilities
\u00a0
include amounts received from a customer that
exceed the revenue recognised, for example prepaid subscriptions.
\u00a0
Customer contract liabilities are expected to be realised within
\u00a0
in the Group\u2019s
normal operating
\u00a0
cycle and
\u00a0
are classified
\u00a0
as current.
Trade and other
\u00a0
payables
NOK in millions
Category
2022
2021
Trade payables
7 955
9 082
Accruals
12 322
13 530
Total trade payables and accruals as of 31 December
FLAC
1)
20 277
22 612
Contract liabilities
5 013
6 001
Government
\u00a0
taxes, tax
\u00a0
deductions
\u00a0
etc.
2 937
3 707
Total other payables as of 31 December
NF
2)
7 950
9 708
Total trade and other payables as of 31 December
28 227
32 320
1)
FLAC: Financial liabilities at amortised cost.
\u00a0
2)
NF: Non-financial assets and liabilities.
Specification
\u00a0
of customer contract
\u00a0
liabilities
NOK in millions
2022
2021
Balance as of 1 January
6 001
6 785
Revenue recognised that was included in opening balance
(4 677)
(6 063)
New contract
\u00a0
liabilities
\u00a0
less transfer
\u00a0
to revenue
4 646
5 990
Disposal of companies
( 897)
-
Currency
\u00a0
and other
\u00a0
effects
( 59)
( 206)
Reclassified
\u00a0
to liabilities
\u00a0
held for
\u00a0
sale
-
( 505)
Balance as of 31 December
5 013
6 001
Customer contract liabilities comprise Group\u2019s obligation to
\u00a0
transfer services to its customers for which
\u00a0
it has received consideration in advance.
This includes unearned revenue relating to prepaid services,
\u00a0
connection fee not considered to be a
\u00a0
separate performance obligation, and other
contract liabilities.
NOTE 25
Contractual commitments
Telenor has entered into agreements with fixed
\u00a0
payments in respect of the following as of 31
\u00a0
December 2022 and as of 31 December 2021.
2022
NOK in millions
2023
2024
2025
2026
2027
After 2027
Contractual purchase obligations
IT-related agreements
246
50
4
-
-
-
Other contractual obligations
4 490
1 164
43
32
32
27
Committed investments
Property plant and equipment and intangible assets
2 242
18
10
10
10
20
Total contractual obligations
6 978
1 233
57
42
42
47
2021
NOK in millions
2022
2023
2024
2025
2026
After 2026
Contractual purchase obligations
IT-related
\u00a0
agreements
329
28
4
-
-
-
Other contractual obligations
5 080
2 018
334
45
13
10
Committed investments
Property plant and equipment and intangible assets
3 621
9
-
-
-
-
Total contractual obligations
9 031
2 055
338
45
13
10
The tables above include agreements under which Telenor
\u00a0
has only committed minimum purchase obligations. The
\u00a0
table for 2021 has been
updated with changes related to other contractual
\u00a0
obligations in Denmark.
NOTE 26
Contract cost and other prepaid costs
Accounting policies
Costs of obtaining customer contracts include commissions
\u00a0
to dealers and costs for fulfilling a
\u00a0
contract include connection and installation of
equipment on customer premises, including direct labour and material
\u00a0
costs. When such costs are incremental and expected
\u00a0
to be recovered, they
are capitalised
\u00a0
as contract
\u00a0
cost assets
\u00a0
and amortised
\u00a0
over the
\u00a0
expected
\u00a0
customer lifetime.
\u00a0
Renewal periods
\u00a0
are included
\u00a0
in the period
\u00a0
based on
historical churn data, unless new costs
\u00a0
are incurred on contract renewals. These costs are
\u00a0
included in EBITDA. The practical expedient of not
capitalising contract costs that would have been
\u00a0
amortised within 12 months has been applied.
Contract costs
\u00a0
and other prepaid
\u00a0
costs
NOK in millions
2022
2021
Contract costs
4 082
4 059
Governmental taxes and duties
127
138
Prepayments
3
217
Total non-current non-financial assets
4 212
4 414
Contract costs
The below
\u00a0
tables set
\u00a0
forth the
\u00a0
costs capitalised
\u00a0
and amortised
\u00a0
during the
\u00a0
year 2022
\u00a0
and 2021:
NOK in millions
As of 31
\u00a0
December
\u00a0
2021
Costs capitalised
Amortisation
- continued
operations
- discontinued
operations
Impairment
- discontinued
operations
Translation
Differences
As of 31
\u00a0
December
\u00a0
2022
Contract acquisition
\u00a0
costs
4 008
2 146
(1 775)
( 174)
9
( 2)
4 041
Contract fulfilment
\u00a0
costs
51
4
( 11)
-
-
( 3)
41
Total contract costs
4 059
2 150
(1 787)
( 174)
9
( 4)
4 082
NOK in millions
As of 31
\u00a0
December
\u00a0
2020
Costs capitalised
Amortisation
- continued
operations
- discontinued
operations
Impairment
- discontinued
operations
Translation
Differences
As of 31
\u00a0
December
\u00a0
2021
Contract acquisition
\u00a0
costs
3 851
2 518
(2 086)
( 173)
-
( 101)
4 008
Contract fulfilment
\u00a0
costs
75
21
( 25)
( 3)
( 12)
( 6)
51
Total contract costs
3 926
2 539
(2 112)
( 176)
( 13)
( 107)
4 059
NOTE 27
Financial assets and non-interest-bearing liabilities
Derivatives such as forward currency contracts and interest rate swaps
\u00a0
are used to mitigate financial risks. Other
financial assets include commercial papers, deposits, lease receivables
\u00a0
and equity investments.
\u00a0
Accounting policies
Financial
\u00a0
assets and
\u00a0
liabilities
A financial instrument is defined as any
\u00a0
contract that gives rise to a financial
\u00a0
asset of one entity and a financial liability or
\u00a0
equity instrument of
another entity. The financial instruments are recognised in
\u00a0
the statement of financial position when Telenor becomes
\u00a0
a party to the contractual
provisions of the instrument, using trade date
\u00a0
accounting. Financial assets and liabilities are offset
\u00a0
when there is intention and legally enforceable
right to
\u00a0
settle the
\u00a0
contracts
\u00a0
net.
Categories
\u00a0
of financial
\u00a0
assets and
\u00a0
liabilities
The categorisation of the financial instrument for
\u00a0
measurement purposes is based on the objective and
\u00a0
the contractual cash flow characteristics
determined at initial recognition. Telenor does not
\u00a0
apply the fair value option.
Telenor has financial assets classified in the following
\u00a0
measurement categories:
\u00a0
\u25cf
FAAC - financial
\u00a0
assets at
\u00a0
amortised
\u00a0
cost. Consist
\u00a0
of financial
\u00a0
assets held
\u00a0
to collect
\u00a0
contractual
\u00a0
cash flows
\u00a0
that are
\u00a0
solely payments
\u00a0
of
principal
\u00a0
and interest.
\u25cf
FVTOCI -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through other
\u00a0
comprehensive
\u00a0
income. Consist
\u00a0
of equity
\u00a0
investments
\u00a0
not held
\u00a0
for trading.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes,
\u00a0
assets held
\u00a0
for
trading
\u00a0
and financial
\u00a0
assets that
\u00a0
are not
\u00a0
classified
\u00a0
in one of
\u00a0
the other
\u00a0
categories.
Telenor has financial liabilities classified in the following
\u00a0
categories:
\u00a0
\u25cf
FLAC - financial
\u00a0
liabilities
\u00a0
at amortised
\u00a0
cost. Consist
\u00a0
of liabilities
\u00a0
that are
\u00a0
not a part
\u00a0
of the category
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
liabilities
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes and
\u00a0
other liabilities
Equity investments include equity instruments and capital contribution
\u00a0
to Telenor Pension Fund. Equity investments not
\u00a0
held for trading are
financial assets with changes in fair value
\u00a0
through other comprehensive income (FVTOCI).
\u00a0
Unrealised gains and losses are reclassified within equity
from other
\u00a0
reserves
\u00a0
to retained
\u00a0
earnings
\u00a0
when the
\u00a0
investment
\u00a0
is disposed.
\u00a0
Equity investments
\u00a0
held for
\u00a0
trading
\u00a0
are financial
\u00a0
assets with
\u00a0
changes in
fair value through profit and loss (FVTPL), and
\u00a0
transaction costs are immediately expensed. Telenor does currently
\u00a0
not have equity instruments held
for trading.
Telenor
\u00a0
uses derivative
\u00a0
financial
\u00a0
instruments
\u00a0
such as forward
\u00a0
currency
\u00a0
contracts,
\u00a0
interest rate
\u00a0
swaps and
\u00a0
cross currency
\u00a0
interest
\u00a0
rate swaps
\u00a0
to
hedge its risks associated with interest rate
\u00a0
and foreign currency fluctuations. The derivative financial instruments are
\u00a0
measured at fair value. Any
gains or
\u00a0
losses arising
\u00a0
from changes
\u00a0
in fair
\u00a0
value on derivatives
\u00a0
that are
\u00a0
not cash flow
\u00a0
hedges or
\u00a0
hedges of
\u00a0
net investments
\u00a0
are recognised
\u00a0
in the
income statement as financial income or expense.
\u00a0
Embedded derivatives
\u00a0
Embedded derivatives are separated from the host
\u00a0
contract and recognised
\u00a0
at fair value, except when the risks and
\u00a0
economic characteristics are
closely
\u00a0
related to
\u00a0
the host contract
\u00a0
and the host
\u00a0
contract
\u00a0
is not carried
\u00a0
at fair value.
\u00a0
The currency
\u00a0
derivative
\u00a0
embedded
\u00a0
in committed
\u00a0
purchase or
sales contracts
\u00a0
are not separated
\u00a0
when the
\u00a0
payment is
\u00a0
in one of
\u00a0
the party\u2019s
\u00a0
functional
\u00a0
currency
\u00a0
or in a commonly
\u00a0
used currency
\u00a0
in the relevant
economic environment. Unrealised gains or losses are
\u00a0
recognised in the income statement.
\u00a0
Other current and non-current financial assets
Financial
\u00a0
assets such
\u00a0
as various
\u00a0
receivables
\u00a0
and deposits
\u00a0
initially
\u00a0
recognised
\u00a0
at fair
\u00a0
value including
\u00a0
directly attributable
\u00a0
transactions
\u00a0
costs and
subsequently measured at amortised cost using the
\u00a0
effective interest rate method. These financial assets
\u00a0
are adjusted for provision for
impairment in accordance with the expected credit loss
\u00a0
model.
\u00a0
Lease receivables
In finance
\u00a0
leases, a
\u00a0
lease receivable
\u00a0
is recognised
\u00a0
based on
\u00a0
future expected
\u00a0
lease payments,
\u00a0
and finance
\u00a0
income is
\u00a0
allocated
\u00a0
using a
\u00a0
constant
periodic
\u00a0
rate of return
\u00a0
over the
\u00a0
lease term.
\u00a0
In a transaction
\u00a0
for which
\u00a0
an underlying
\u00a0
asset is
\u00a0
sub-leased
\u00a0
to a third
\u00a0
party, the
\u00a0
sublease is
\u00a0
classified
\u00a0
as a
finance or
\u00a0
operating
\u00a0
lease by
\u00a0
reference
\u00a0
to the right-of-use
\u00a0
asset arising
\u00a0
from the
\u00a0
head lease.
\u00a0
See note
\u00a0
3 for further
\u00a0
information
\u00a0
about operation
lease revenue.
Supply chain financing agreements
\u00a0
In supply chain financing agreements, the payables are
\u00a0
reclassified from trade payables to current non-interest
\u00a0
bearing liabilities when the
financing arrangements are linked to the payment
\u00a0
terms of the contract with the vendor.
\u00a0
The current liability is presented as
\u00a0
non-interest bearing
as the payment of interest is carried
\u00a0
by the vendor. When the financial institution makes
\u00a0
the payment to the vendor, an operational
\u00a0
cash outflow is
presented
\u00a0
in the Statement
\u00a0
of Cash Flows
\u00a0
if it is
\u00a0
related to
\u00a0
operating
\u00a0
activities
\u00a0
and cash outflow
\u00a0
from investing
\u00a0
activities
\u00a0
if it is related
\u00a0
to investing
activities. At the same time a financial
\u00a0
cash inflow reflecting that a financial liability has
\u00a0
been obtained. The subsequent payment of the financial
liability
\u00a0
is presented as financial cash outflow in
\u00a0
the cash flow statement. Supply chain financing
\u00a0
arrangements that do not have any link
\u00a0
to payment
terms or any
\u00a0
other parts
\u00a0
of the contract
\u00a0
with the
\u00a0
vendor are
\u00a0
classified
\u00a0
as trade
\u00a0
payables.
\u00a0
Cash outflow
\u00a0
from such arrangements
\u00a0
are presented
\u00a0
as
operating
\u00a0
activities
\u00a0
in the Statement
\u00a0
of Cash Flows.
Non-current financial
\u00a0
assets
NOK in millions
4)
Category
2022
2021
Equity investments
3
FVTOCI
1)
937
975
Financial derivatives
2
FVTPL
2)
248
59
Financial derivatives designated for net investment hedge
2
713
27
Other financial
\u00a0
non-current
\u00a0
non-interest-bearing
\u00a0
assets
FAAC
3)
3 066
3 318
Fair value hedge instruments
2
25
927
Other financial
\u00a0
non-current
\u00a0
interest-bearing
\u00a0
assets
FAAC
3)
3 230
970
Finance lease receivable
5)
1 046
1 356
Total non-current financial assets as of 31 December
9 264
7 632
1)
FVTOCI: Fair value through other comprehensive income.
\u00a0
2)
FVTPL: Fair value through profit and loss.
\u00a0
3)
FAAC: Financial assets at amortised cost.
\u00a0
4)
For information about the fair value level of financial
\u00a0
instruments, see note 32.
\u00a0
Equity investments
Equity investments (FVTOCI) include capital contribution to
\u00a0
Telenor Pension Fund of NOK 0.3 billion
\u00a0
and other equity investments of NOK 0.6 billion
(NOK 0.3 billion and NOK 0.7 billion in
\u00a0
2021,
\u00a0
respectively).
Other financial non-current non-interest-bearing assets
Other financial non-current non-interest-bearing
\u00a0
assets as of 31 December 2022 includes
\u00a0
a deposit of NOK 1.9 billion paid to
\u00a0
the Bangladesh
Telecommunication Regulatory Commission (BTRC, see note 23),
\u00a0
long term deposits of NOK 0.3 billion
\u00a0
and other non-current receivables of NOK
0.9 billion
\u00a0
(NOK 2.0
\u00a0
billion, NOK
\u00a0
0.6 billion
\u00a0
and of NOK
\u00a0
0.7 billion
\u00a0
in 2021,
\u00a0
respectively).
Other financial non-current interest-bearing
\u00a0
assets
Other financial
\u00a0
non-current
\u00a0
interest-bearing
\u00a0
assets includes
\u00a0
a receivable
\u00a0
against the
\u00a0
Norwegian
\u00a0
tax authorities
\u00a0
of NOK 2.7
\u00a0
billion related
\u00a0
to the
ongoing court
\u00a0
case for
\u00a0
losses on
\u00a0
receivables
\u00a0
on the Indian
\u00a0
subsidiary
\u00a0
Unitech Wireless
\u00a0
after having
\u00a0
repaid, as
\u00a0
guarantor,
\u00a0
all Unitech
\u00a0
Wireless\u2019
interest-bearing borrowings.
\u00a0
In 2019, Telenor paid an amount of
\u00a0
NOK 2.7 billion after an unfavourable decision by
\u00a0
the Norwegian tax authorities. In
March 2022, Telenor received a favourable verdict
\u00a0
and reversed the tax expense accordingly, see note 10.
Finance
\u00a0
lease receivables
Telenor has recognised receivables at present value
\u00a0
of future lease payments to be received in
\u00a0
lease arrangements where Telenor has transferred
substantially
\u00a0
all the risks
\u00a0
and rewards
\u00a0
incidental
\u00a0
to ownership
\u00a0
of the underlying
\u00a0
assets to
\u00a0
the lessee.
\u00a0
Current finance
\u00a0
lease receivables
\u00a0
are included
in Trade and other receivables (see note 19).
2022
2021
NOK in millions
Current
Non-current
Total
Current
Non-current
Total
Sublease of land
361
973
1 334
329
1 203
1 533
Lease of satellite
97
72
169
94
153
247
Total finance
\u00a0
lease receivables
458
1 046
1 504
423
1 356
1 779
During 2022, the Group recognised interest income
\u00a0
of NOK 60 million (NOK 73 million
\u00a0
in 2021) (note 9) related to finance lease receivables.
Dtac has Tower Service Agreement with the National
\u00a0
Telecom Public Company Limited (NT) and under the agreement,
\u00a0
dtac transferred towers that
dtac procured
\u00a0
under the
\u00a0
concession
\u00a0
agreement
\u00a0
to operate
\u00a0
and to provide
\u00a0
cellular
\u00a0
telephonic
\u00a0
service and
\u00a0
entered into
\u00a0
lease agreement
\u00a0
to use the
towers. The right to use towers from
\u00a0
NT was recognised as right-of-use asset with
\u00a0
corresponding lease liability. Under the agreement, dtac
\u00a0
shall
itself have lease agreements for the land
\u00a0
with landowners and shall receive compensation from NT
\u00a0
for this. dtac recognised lease agreements as a
lessee with
\u00a0
the landowners
\u00a0
for the land
\u00a0
related to
\u00a0
transferred
\u00a0
towers to
\u00a0
NT with
\u00a0
related lease
\u00a0
liabilities.
\u00a0
Right-of-use
\u00a0
assets related
\u00a0
to land was
derecognised on 1 January 2019 based on the
\u00a0
sublease arrangement with NT and a finance lease
\u00a0
receivable was recognised with reference to the
tenure of the agreement with NT.
\u00a0
The Group
\u00a0
entered into
\u00a0
a long-term
\u00a0
lease with
\u00a0
UPC on 1
\u00a0
April 2017
\u00a0
for the lease
\u00a0
of 9 transponders
\u00a0
on Thor
\u00a0
6, where
\u00a0
the final
\u00a0
payment from
\u00a0
UPC will
be made in
\u00a0
January 2025.
\u00a0
According
\u00a0
to the agreement,
\u00a0
substantially
\u00a0
all the risks
\u00a0
and rewards
\u00a0
related
\u00a0
to Thor 6
\u00a0
are transferred
\u00a0
to UPC, and
accordingly a finance lease receivable was recognised at present
\u00a0
value, which represents the deferred payments to
\u00a0
be received until January 2025.
\u00a0
The following
\u00a0
table sets
\u00a0
forth the
\u00a0
maturity
\u00a0
analysis
\u00a0
of lease
\u00a0
receivables:
NOK in millions
2022
2021
506
438
1 to 2 years
445
449
2 to 3 years
384
415
3 to 4 years
272
360
4 to 5 years
-
269
After 5 years
-
-
Total undiscounted lease payments receivable
1 607
1 931
Unearned
\u00a0
interest income
( 103)
( 152)
Net investment in leases
1 504
1 779
Current financial
\u00a0
assets
NOK in millions
3)
Category
2022
2021
Assets held
\u00a0
for trading
2
FVTPL
1)
50
48
Bonds and commercial papers > 3 months
FAAC
2)
277
327
Financial derivatives
\u00a0
2
FVTPL
1)
29
1
Financial derivatives designated for net investment hedge
2
2
320
Fair value hedge instruments
2
2
143
Total other current financial assets as of 31 December
361
839
Non-current
\u00a0
non-interest-bearing
\u00a0
liabilities
NOK in millions
3)
Category
2022
2021
Financial derivatives
\u00a0
2
FVTPL
1)
149
156
Financial derivatives designated for net investment hedge
2
1 306
950
Other non-current non-interest-bearing
\u00a0
liabilities
FLAC
2)
317
282
Total non-current non-interest-bearing
\u00a0
liabilities as of 31 December
1 772
1 388
Current non-interest-bearing
\u00a0
liabilities
NOK in millions
3)
Category
2022
2021
Financial derivatives
\u00a0
2
FVTPL
1)
3
6
Financial derivatives designated for net investment hedge
2
382
669
Other current non-interest-bearing
\u00a0
liabilities
FLAC
2)
1 308
1 294
Total current non-interest-bearing
\u00a0
liabilities as of 31 December
1 694
1 969
1)
FVTPL: Fair value through profit and loss.
2)
FLAC: Financial liabilities at amortised cost.
3)
For information about the fair value level of financial
\u00a0
instruments, see note 32.
Other current non-interest-bearing
\u00a0
liabilities include liabilities to financing institutions under supply
\u00a0
chain financing programs of NOK 616 million as
of 31 December 2022 (NOK 596 million as
\u00a0
of 31 December 2021).
NOTE 28
Equity
Paid-in capital
NOK in millions,
\u00a0
except number
\u00a0
of shares
Share capital
Other paid
\u00a0
in capital
Total paid-in
\u00a0
capital
Equity as of 1 January 2021
8 397
69
-
8 466
Share buyback
-
-
-
-
-
Cancellation
\u00a0
of shares
-
-
-
-
-
Equity as of 31 December 2021
8 397
69
-
8 466
Share buyback
-
-
-
-
-
Cancellation
\u00a0
of shares
-
-
-
-
-
Equity as of 31 December 2022
8 397
69
-
8 466
Nominal value
\u00a0
per share
\u00a0
is NOK 6.
At the Extraordinary General Meeting on 26 January
\u00a0
2023, The Board of Directors authorised a new
\u00a0
share buyback program. At the same time the
company has
\u00a0
the intention
\u00a0
to enter
\u00a0
into an agreement
\u00a0
with the
\u00a0
Norwegian
\u00a0
State represented
\u00a0
by the Ministry
\u00a0
of Trade,
\u00a0
Industry and
\u00a0
Fisheries
\u00a0
to buy
back shares
\u00a0
for the purpose
\u00a0
of cancellation
\u00a0
of shares
\u00a0
and write-down
\u00a0
of share
\u00a0
capital in
\u00a0
order to
\u00a0
maintain the
\u00a0
Government
\u00a0
proportion
\u00a0
of the total
shares. The
\u00a0
Board of
\u00a0
Directors
\u00a0
is authorised
\u00a0
to acquire
\u00a0
up to 47
\u00a0
000 000 own
\u00a0
shares with
\u00a0
nominal value
\u00a0
of NOK 282
\u00a0
million which
\u00a0
corresponds
\u00a0
to
approximately 3.4% of the company\u2019s share capital.
\u00a0
The share buyback is limited to NOK 3.7
\u00a0
billion. The authorisation is valid until 31
\u00a0
December
Other reserves
NOK in millions
Net unrealised
gains/(losses)
reserve
Employee
equity bene-
fits reserve
Pension
remeasure-
ment reserve
Transactions
with non-
controlling
interests
Share of equity
other
comprehensive
income in
associated
companies
Other equity
transactions
Total other
reserves
Equity as of 1 January 2021
117
403
298
-
1 469
(24 302)
(22 014)
Other comprehensive
\u00a0
income (loss),
\u00a0
net of taxes
134
-
204
-
76
-
415
Share-based payment
-
66
-
-
-
-
66
Equity adjustments
\u00a0
in associated
\u00a0
companies
-
-
-
-
3
-
3
Equity as of 31 December 2021
251
469
503
-
1 548
(24 302)
(21 530)
Other comprehensive
\u00a0
income (loss),
\u00a0
net of taxes
157
-
520
-
46
-
723
Share-based payment
-
61
-
-
-
-
61
Other changes in other reserves during 2022
408
531
1 023
-
1 594
(24 302)
(20 746)
Net unrealised gains/losses reserve
This reserve includes unrealised gains and losses arising
\u00a0
from changes in fair value of equity
\u00a0
investments are recognised directly in other
comprehensive
\u00a0
income until
\u00a0
the investment
\u00a0
is disposed
\u00a0
of, at which
\u00a0
time the
\u00a0
cumulative
\u00a0
gain or loss
\u00a0
is reclassified
\u00a0
within equity
\u00a0
from other
reserves
\u00a0
to retained
\u00a0
earnings.
Employee equity benefits reserve
Share-based payments represents cost
\u00a0
charged to income statement over the vesting
\u00a0
period based on the fair value measured
\u00a0
at grant date for
equity-settled share-based
\u00a0
payments provided to employees, including key management
\u00a0
personnel, as part of their remuneration. In 2022,
\u00a0
the
Group paid NOK 27 million (did not
\u00a0
pay any bonus share in 2021)
\u00a0
related to the equity-settled
\u00a0
share-based program.
Please refer
\u00a0
to note 37
\u00a0
and chapter
\u00a0
12 in the
\u00a0
corporate
\u00a0
governance
\u00a0
section of
\u00a0
the Board
\u00a0
of Directors\u2019
\u00a0
report for
\u00a0
further details
\u00a0
on these
programmes.
Pension re-measurement
This reserve
\u00a0
includes
\u00a0
the effect
\u00a0
of re-measurement
\u00a0
of pension
\u00a0
obligations
\u00a0
arising
\u00a0
due to change
\u00a0
in assumptions,
\u00a0
such as discount
\u00a0
rate and
\u00a0
long-
term demographic
\u00a0
trends.
NOK in millions
Pension
remeasurement
Income taxes
Net pension
remeasurement
Equity as of 1 January 2021
406
( 107)
298
Other comprehensive
\u00a0
income (loss)
259
( 54)
204
Equity as of 31 December 2021
665
( 161)
503
Other comprehensive
\u00a0
income (loss)
657
( 137)
520
Equity as of 31 December 2022
1 322
( 299)
1 023
See note
\u00a0
21 for more
\u00a0
information
\u00a0
relating
\u00a0
to pension
\u00a0
obligations.
Share of equity adjustments and other comprehensive income in
\u00a0
associated companies
This reserve includes underlying adjustments to equity
\u00a0
in associated companies, such as other comprehensive
\u00a0
income, share buybacks and
transactions with non-controlling interests.
Other equity transactions
This includes
\u00a0
the decrease
\u00a0
in other reserves
\u00a0
as a result
\u00a0
of acquisition
\u00a0
and sale/cancellation
\u00a0
of treasury
\u00a0
shares and
\u00a0
the increase
\u00a0
as a result
\u00a0
of
transfers
\u00a0
from other
\u00a0
paid-in capital,
\u00a0
including
\u00a0
transfers
\u00a0
from other
\u00a0
paid-in capital
\u00a0
related to
\u00a0
cancellation
\u00a0
of treasury
\u00a0
shares. The
\u00a0
price paid
\u00a0
in excess
of the nominal
\u00a0
value of
\u00a0
the shares
\u00a0
reduces this
\u00a0
reserve.
Cumulative translation
\u00a0
differences
NOK in millions
Foreign currency
translation
Net investment
hedge
Income taxes
Net translation
differences
Equity as of 1 January 2021
1 424
(5 565)
964
(3 181)
Changes during
\u00a0
2021, excluding
\u00a0
effects of
\u00a0
disposal
(3 355)
2 447
( 538)
(1 446)
Net changes during 2021
(3 355)
2 447
( 538)
(1 446)
Equity as of 31 December 2021
(1 931)
(3 118)
426
(4 627)
Changes during
\u00a0
2022, excluding
\u00a0
effects of
\u00a0
disposal
1 695
(1 402)
308
602
Amount reclassified from other comprehensive income to
\u00a0
income
statement
\u00a0
on disposal
370
233
-
603
Net changes during 2022
2 066
(1 170)
308
1 205
Equity as of 31 December 2022
135
(4 287)
734
(3 422)
During 2022,
\u00a0
a loss of NOK 370 million was reclassified
\u00a0
from other comprehensive income to income statement
\u00a0
which mainly consisted of NOK 789
million currency
\u00a0
loss on disposal
\u00a0
of Telenor
\u00a0
Myanmar,
\u00a0
NOK 450 million
\u00a0
gain on
\u00a0
disposal
\u00a0
of Digi
\u00a0
as a subsidiary
\u00a0
and recognised
\u00a0
its 32.47%
\u00a0
share of
the associated company CelcomDigi and
\u00a0
NOK 42 million currency loss on disposal
\u00a0
of Wave Money. See note 35 for
\u00a0
more information
During 2021,
\u00a0
there was no reclassification from other comprehensive
\u00a0
income to income statement.
In 2022, the translation difference gain on net
\u00a0
investment in foreign operations was caused by
\u00a0
depreciation of the Norwegian Krone against Danish
Krone, Euro, Thai Bath, and Malaysian Ringgit. The
\u00a0
appreciation of Danish Krone by 5%, Euro
\u00a0
by 5%, Thai Bath by 7% and
\u00a0
Malaysian Ringgit by 6%
against Norwegian Krone had the most significant
\u00a0
impact on the translation difference gain.
\u00a0
In 2022, a loss of NOK 233 million was
\u00a0
reclassified from other comprehensive income to income
\u00a0
statement on net investment hedge item related
\u00a0
to
Digi disposal.
In 2021, the translation difference loss on net
\u00a0
investment in foreign operations was caused by
\u00a0
appreciation of the Norwegian Krone against all the
functional currencies of the Group\u2019s investments except
\u00a0
the Bangladeshi Taka. The depreciation of Euro by
\u00a0
5%, Swedish Krone by 7%, Thai Bath
\u00a0
by
7%, Danish Krone by 5%, Pakistani Rupee
\u00a0
by 6% and Myanmar Kyat by 23% against Norwegian
\u00a0
Krone had the most significant impact on
\u00a0
the
translation
\u00a0
difference
\u00a0
loss.
Non-controlling
\u00a0
interests
NOK in millions
Country of
incorporation
and
operation
Non-controlling
2022
Non-controlling
2021
Non-controlling
31.12.22
Non-controlling
31.12.21
Non-controlling
Non-controlling
Malaysia
999
1 227
-
686
1 136
1 196
Bangladesh
1 372
1 523
1 948
2 255
1 595
1 616
Total Access Communications
Plc (dtac)
Thailand
296
314
2 316
2 287
419
484
Others
( 2)
( 1)
( 28)
( 23)
9
-
Total
2 665
3 063
4 236
5 206
3 159
3 296
Summarised financial
\u00a0
information for
\u00a0
subsidiaries with
\u00a0
significant
\u00a0
non-controlling
\u00a0
interests
\u00a0
Summarised statement of financial position as of 31 December:
2022
2021
NOK in millions
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Current assets
-
1 155
6 849
3 251
1 010
6 189
-
16 518
40 177
14 077
15 680
40 786
Current liabilities
-
(8 876)
(12 501)
(6 318)
(8 731)
(12 517)
Non-current liabilities
-
(4 531)
(25 636)
(9 053)
(3 032)
(25 917)
Total equity
-
4 265
8 888
1 958
4 927
8 541
Equity holders
\u00a0
of Telenor
\u00a0
ASA
-
2 317
6 572
1 271
2 672
6 254
Non-controlling interests
-
1 948
2 316
686
2 255
2 287
Summarised comprehensive income information 1 January \u2013 31 December:
2022
2021
NOK in millions
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Revenues
-
15 508
22 107
-
14 464
21 878
Net income
-
3 188
960
-
3 460
979
Total comprehensive income
-
2 917
1 544
-
3 511
313
Attributable
\u00a0
to non-controlling
\u00a0
interests
-
1 372
296
-
1 523
314
Summarised cash flow information 1 January \u2013 31 December:
2022
2021
NOK in millions
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Operating activities
5 239
6 418
7 058
5 343
5 623
6 779
Investing
\u00a0
activities
(7 809)
(2 224)
(3 318)
(1 481)
(1 899)
(3 915)
Financing activities
2 123
(4 135)
(3 171)
(4 066)
(3 708)
(3 691)
Effect of exchange rate changes on cash and
cash equivalents
14
( 23)
90
( 6)
4
( 121)
Net increase/(decrease) in cash and cash
equivalents
( 433)
36
659
( 210)
19
( 947)
NOTE 29
Lease liabilities
This note gives further information about the lease liabilities of
\u00a0
Telenor, such as lease liabilities per currency and
subsidiary in addition to the maturity profile. Refer to note 16 for
\u00a0
description of accounting policies and key
judgments and estimates relating to lease liabilities and right-of-use
\u00a0
assets.
Lease liabilities
\u00a0
measured at amortised
\u00a0
cost
2022
2021
NOK in millions
Current
Non-current
Total
Current
Non-current
Total
Lease liability related to spectrum licences
2 931
11 944
14 875
2 264
12 496
14 760
Lease liability
\u00a0
related to
\u00a0
other lease
\u00a0
contracts
3 743
12 473
16 216
4 713
15 604
20 317
Total lease liabilities
6 674
24 417
31 091
6 977
28 101
35 077
Distribution
\u00a0
of lease liabilities
\u00a0
per currency
\u00a0
and subsidiary
\u00a0
as of 31 December
\u00a0
2022
2022
2021
NOK in millions
Currency
Spectrum
licences
Other lease
contracts
Total
Spectrum
licences
Other lease
contracts
Total
Subsidiary
dtac
THB
8 696
4 348
13 044
9 350
5 062
14 412
Digi
MYR
-
-
-
1 776
3 428
5 204
Grameenphone
BDT
2 242
2 714
4 955
1 230
2 059
3 289
Pakistan
PKR
-
1 953
1 953
-
2 339
2 339
Pakistan
USD
1 006
-
1 006
88
-
88
Norway
NOK
1 918
379
2 298
1 401
351
1 752
Sweden
SEK
32
1 690
1 721
36
1 875
1 912
Denmark
728
678
1 406
585
569
1 154
Finland
EUR
253
1 557
1 810
294
1 589
1 883
Other units
NOK
-
2 898
2 898
-
3 044
3 044
Total subsidiaries
14 875
16 216
31 091
14 760
20 317
35 077
Lease liabilities
\u00a0
maturity profile
NOK in millions
Total as of
31.12.22
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
Lease liabilities - spectrum licences
14 875
2 931
2 363
1 947
2 012
1 891
863
875
901
424
213
455
Lease liabilities - other lease contracts
16 216
3 743
3 745
2 935
1 894
970
508
412
362
308
193
1 146
Sum of lease liabilities
31 091
6 674
6 109
4 883
3 906
2 861
1 371
1 286
1 263
732
406
1 601
Future interest
\u00a0
payments
3 618
945
742
556
408
289
202
161
122
83
61
49
Total including future interest
payments
34 709
7 619
6 851
5 439
4 314
3 150
1 573
1 447
1 385
815
466
1 650
NOK in millions
Total as of
31.12.21
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
Lease liabilities - spectrum licences
14 760
2 264
1 812
1 852
1 839
1 864
1 768
800
798
811
352
600
Lease liabilities - other lease contracts
20 317
4 713
3 752
3 650
2 944
1 995
796
465
316
226
161
1 299
Sum of lease liabilities
35 077
6 977
5 564
5 503
4 783
3 858
2 565
1 265
1 114
1 037
514
1 899
Future interest
\u00a0
payments
4 672
1 158
927
744
562
404
277
192
151
114
80
63
Total including future interest
payments
39 749
8 135
6 491
6 247
5 345
4 263
2 842
1 457
1 264
1 151
594
1 961
NOTE 30
Interest-bearing liabilities
The non-current debt in Telenor mainly consists of bonds issued under
\u00a0
the EMTN programme (Euro Medium Term
Note), bonds issued in other markets and bank loans. Forward contracts
\u00a0
and cross currency swaps are used to
hedge foreign exchange rate risk for certain assets.
\u00a0
Accounting policies
Interest-bearing
\u00a0
liabilities
\u00a0
are initially
\u00a0
measured
\u00a0
at fair value
\u00a0
net of transaction
\u00a0
costs and
\u00a0
are subsequently
\u00a0
measured
\u00a0
at amortised
\u00a0
cost using
\u00a0
the
effective
\u00a0
interest-rate
\u00a0
method (FLAC).
\u00a0
In addition,
\u00a0
where fair
\u00a0
value hedge
\u00a0
accounting
\u00a0
is applied
\u00a0
the hedged
\u00a0
liabilities
\u00a0
are adjusted
\u00a0
for gains
\u00a0
and
losses attributable
\u00a0
to the risk
\u00a0
being hedged.
\u00a0
On extinguishment
\u00a0
of debt,
\u00a0
in whole
\u00a0
or in part,
\u00a0
the difference
\u00a0
between
\u00a0
the carrying
\u00a0
amount of
\u00a0
the
liability and the consideration paid is recognised
\u00a0
in the income statement.
Interest-bearing
\u00a0
liabilities
2022
2021
NOK in millions
Current interest-
bearing liabilities
Non-current
interest-bearing
liabilities
Total
Current interest-
bearing liabilities
Non-current
interest-bearing
liabilities
Total
Interest-bearing liabilities measured at amortised cost
Bank loans
1 586
2 349
3 935
2 783
3 331
6 115
Bonds
6 969
76 529
83 498
6 423
83 781
90 204
Other liabilities
604
194
798
70
579
648
Interest-bearing liabilities measured at fair value
Fair value hedge instruments
10
3 652
3 662
-
120
120
Total interest-bearing
\u00a0
liabilities
9 169
82 724
91 893
9 276
87 811
97 087
Fair value of debt
1)
99 389
99 389
Of which fair value hierarchy level 1
2)
92 421
92 421
Of which fair value hierarchy level 2
2)
6 968
6 968
1)
Excluding lease liabilities and licence obligations.
\u00a0
2)
For information about the fair value hierarchy for valuation
\u00a0
of financial instruments, see note 32.
\u00a0
Non-current
\u00a0
interest-bearing
\u00a0
liabilities
2022
2021
NOK in millions
Currency
Debt before
\u00a0
the
\u00a0
swaps
Debt adjusted
\u00a0
for
\u00a0
currency swaps
2)
Debt before
\u00a0
the
\u00a0
swaps
Debt adjusted
\u00a0
for
\u00a0
currency swaps
2)
EUR
60 714
35 496
62 981
39 014
NOK
1)
-
(2 735)
-
(2 735)
SEK
4 248
15 670
4 376
16 152
USD
-
13 612
-
15 540
Total Telenor ASA
64 962
62 044
67 357
67 970
DNA - Finland
EUR
2 601
2 601
2 454
2 454
dtac - Thailand
THB
14 967
14 967
13 558
13 558
Digi - Malaysia
MYR
-
-
3 863
3 863
Other non-current interest-bearing
\u00a0
liabilities
194
194
578
578
Total subsidiaries
17 762
17 762
20 454
20 454
Total non-current interest-bearing liabilities
82 724
79 805
87 811
88 424
1)
Telenor ASA\u2019s debt position in Norwegian Kroner is
\u00a0
a net asset position when including currency swaps.
\u00a0
2)
Debt adjusted for currency swaps includes financial instruments
\u00a0
that are not classified as interest-bearing liabilities
\u00a0
in the statement of financial position.
Current interest-bearing
\u00a0
liabilities
2022
2021
NOK in millions
Currency
Debt before
\u00a0
the
\u00a0
swaps
Debt adjusted
\u00a0
for
\u00a0
currency swaps
2)
Debt before
\u00a0
the
\u00a0
swaps
Debt adjusted
\u00a0
for
\u00a0
currency swaps
2)
Company
NOK
1)
-
3 335
-
(558)
EUR
1)
5 263
963
4 992
(658)
SEK
-
236
-
351
MYR
-
2 224
-
2 106
THB
-
3 624
-
5 093
USD
1)
-
(4 782)
-
(1 000)
Total Telenor ASA
5 263
5 599
4 992
5 333
dtac - Thailand
THB
2 570
2 570
2 121
2 121
Digi - Malaysia
MYR
-
-
1 460
1 460
Grameenphone - Bangladesh
BDT
481
481
563
563
Pakistan
PKR
232
232
81
81
Other current interest-bearing
\u00a0
liabilities
623
623
58
58
Total subsidiaries
3 906
3 906
4 284
4 284
Total current interest-bearing liabilities
9 169
9 505
9 276
9 617
1)
Telenor ASA\u2019s debt positions in US Dollars as of 31
\u00a0
December 2022 and Norwegian Kroner, US Dollars
\u00a0
and Euro as of 31 December 2021, are net asset
\u00a0
positions
when including currency swaps.
\u00a0
2)
Debt adjusted for currency swaps includes financial instruments
\u00a0
that are not classified as interest-bearing liabilities
\u00a0
in the statement of financial position.
Debt issued
\u00a0
under Telenor
\u00a0
ASA\u2019s EMTN
\u00a0
programme
\u00a0
is based
\u00a0
on documentation
\u00a0
that is
\u00a0
commonly
\u00a0
used for
\u00a0
investment
\u00a0
grade issuers
\u00a0
in the
Eurobond market. This documentation contains provisions restricting
\u00a0
the pledge of assets to secure future
\u00a0
borrowings without granting a similar
secured status to the existing lenders (negative
\u00a0
pledges) and contains covenants limiting disposals of assets.
Bonds issued under the EMTN programme are
\u00a0
subject to a Change of Control Clause.
\u00a0
Such Change of Control shall be deemed to
\u00a0
have occurred if
a person
\u00a0
or entity,
\u00a0
other than
\u00a0
the Kingdom
\u00a0
of Norway,
\u00a0
directly
\u00a0
or indirectly
\u00a0
owns or acquires
\u00a0
more than
\u00a0
50% of the
\u00a0
issued ordinary
\u00a0
share capital
\u00a0
of
Telenor
\u00a0
ASA. If such
\u00a0
Change of
\u00a0
Control leads
\u00a0
to a downgrade
\u00a0
below investment
\u00a0
grade rating,
\u00a0
the holder
\u00a0
of such bonds
\u00a0
can require
\u00a0
Telenor ASA
\u00a0
to
redeem the
\u00a0
principal
\u00a0
amount together
\u00a0
with accrued
\u00a0
interest.
\u00a0
The full
\u00a0
definition
\u00a0
of this Change
\u00a0
of Control
\u00a0
Clause is
\u00a0
described
\u00a0
in the Final
\u00a0
Terms for
each specific bond issue.
Telenor
\u00a0
ASA did not
\u00a0
issue bonds
\u00a0
under the
\u00a0
EMTN programme
\u00a0
in 2022.
\u00a0
All outstanding
\u00a0
debt issued
\u00a0
by Telenor
\u00a0
ASA is unsecured.
Furthermore, debt in dtac is mainly comprised of
\u00a0
issued bonds (NOK 14.3 billion) and debt
\u00a0
to financial institutions (NOK 3.2 billion).
The interest-bearing
\u00a0
liabilities in subsidiaries are generally not guaranteed by
\u00a0
Telenor ASA and are subject to standard
\u00a0
financial covenants, some of
which limit
\u00a0
the ability
\u00a0
to transfer
\u00a0
funds to Telenor
\u00a0
ASA in the
\u00a0
form of
\u00a0
dividends
\u00a0
or loans.
\u00a0
Refer to note 31 Capital and financial risk
\u00a0
management for further information about capital management,
\u00a0
maturity profile of the interest-bearing
liabilities,
\u00a0
liquidity
\u00a0
risk, exchange
\u00a0
rate risk,
\u00a0
interest rate
\u00a0
risk and
\u00a0
derivatives.
NOTE 31
Capital and financial risk management
The objectives and policies for capital and risk management
\u00a0
are described in this note, in addition to exposure and
sensitivity for financial risks such as liquidity risk, interest
\u00a0
rate risk, foreign exchange risk and credit risk. Telenor
uses various types of derivatives to hedge such exposure.
\u00a0
Accounting policies
Hedge accounting is applied for fair value
\u00a0
hedges and hedges of net investments in foreign
\u00a0
operations when the hedging criteria are met.
\u00a0
For fair
value
\u00a0
hedges, the carrying amount of the hedged
\u00a0
item is adjusted for gains and losses attributable
\u00a0
to the risk being hedged. The derivative is also
measured at fair value, and gains and losses
\u00a0
from both the hedging instrument and the hedged
\u00a0
item are recognised in the income statement.
Hedge effectiveness
\u00a0
is assessed
\u00a0
on an ongoing
\u00a0
basis, and
\u00a0
hedge accounting
\u00a0
is discontinued
\u00a0
if the hedge
\u00a0
no longer
\u00a0
meets the
\u00a0
hedge accounting
criteria.
\u00a0
If the hedged
\u00a0
item still
\u00a0
exists and
\u00a0
is not sold,
\u00a0
the fair
\u00a0
value adjustment
\u00a0
to the hedged
\u00a0
item attributable
\u00a0
to the risk
\u00a0
being hedged
\u00a0
at de-
designation
\u00a0
will be
\u00a0
amortised
\u00a0
in the income
\u00a0
statement
\u00a0
over the
\u00a0
remaining
\u00a0
time to maturity.
\u00a0
A hedge
\u00a0
of a net investment
\u00a0
in a foreign
\u00a0
operation
\u00a0
is accounted
\u00a0
for in a
\u00a0
similar way
\u00a0
as a cash
\u00a0
flow hedge.
\u00a0
Foreign exchange
\u00a0
gains or
\u00a0
losses on
\u00a0
the
hedging instrument relating to the effective portion of
\u00a0
the hedge are recognised directly in other
\u00a0
comprehensive income while any foreign
exchange gains or losses relating to the
\u00a0
ineffective portion are recognised in the income statement.
\u00a0
On disposal of the foreign entity, the
cumulative foreign exchange gains or losses recognised in
\u00a0
other comprehensive income is reclassified to the
\u00a0
income statement.
Refer to
\u00a0
note 27 Financial
\u00a0
assets and
\u00a0
liabilities
\u00a0
for further
\u00a0
information
\u00a0
on accounting
\u00a0
policies
\u00a0
for derivatives.
.
In recent
\u00a0
years, Telenor
\u00a0
has measured
\u00a0
leverage
\u00a0
as the ratio
\u00a0
of Net debt
\u00a0
to EBITDA
\u00a0
before other
\u00a0
items. Following
\u00a0
the structural
\u00a0
changes in
\u00a0
the
portfolio,
\u00a0
and triggered
\u00a0
by closing
\u00a0
of the merger
\u00a0
in Malaysia,
\u00a0
Telenor measures
\u00a0
the leverage
\u00a0
from 2022
\u00a0
as the ratio
\u00a0
of Net debt
\u00a0
to EBITDA
\u00a0
before
other items and dividends from associated companies
\u00a0
and joint ventures. Telenor aims to maintain
\u00a0
a solid balance sheet through
\u00a0
keeping leverage
ratio in the range of 1.8x to
\u00a0
2.3x maintain financial flexibility and ensure cost efficient
\u00a0
funding (see page 180 for alternative performance measures).
As of 31 December 2022,
\u00a0
the reported leverage ratio was 2.2x
\u00a0
(2.1x
\u00a0
as of 31 December 2021).
\u00a0
The targeted capital structure provides a good
\u00a0
balance
between shareholder return and a solid balance
\u00a0
sheet with stable access to global debt markets,
\u00a0
while also supporting Telenor\u2019s strategic priorities.
As of 31 December 2022, Telenor ASA\u2019s long-term credit
\u00a0
rating was \u201cBaa1/stable outlook\u201d
\u00a0
by Moody\u2019s Investors Service and \u201cA-/stable outlook\u201d
\u00a0
by
Standard & Poor\u2019s (S&P). During 2022, Moody\u2019s changed
\u00a0
their rating and outlook from \u201cA3/negative watch\u201d
\u00a0
to \u201cBaa1/stable outlook\u201d, while S&P\u2019s
rating and outlook were unchanged throughout
\u00a0
the year.
\u00a0
Key elements
\u00a0
of the Group\u2019s
\u00a0
capital
\u00a0
structure
\u00a0
include
\u00a0
interest-bearing
\u00a0
debt as
\u00a0
disclosed
\u00a0
in note 30,
\u00a0
cash and cash
\u00a0
equivalents
\u00a0
as disclosed
\u00a0
in note
20 and equity
\u00a0
attributable
\u00a0
to the shareholders
\u00a0
of Telenor
\u00a0
ASA as presented
\u00a0
in the consolidated
\u00a0
statement
\u00a0
of changes
\u00a0
in equity
\u00a0
and in note
\u00a0
28.
\u00a0
In order
\u00a0
to adjust
\u00a0
the capital
\u00a0
structure,
\u00a0
the Group
\u00a0
may acquire
\u00a0
or sell own
\u00a0
shares, distribute
\u00a0
dividends
\u00a0
to shareholders,
\u00a0
return capital
\u00a0
to
shareholders or issue new shares. In 2022, Telenor\u2019s
\u00a0
shareholder remuneration via dividend was NOK 13.0 billion
\u00a0
comprised of ordinary dividends
paid out in June 2022 (NOK 5.00 per
\u00a0
share) and October 2022 (NOK 4.30 per share).
\u00a0
For the financial
\u00a0
year 2022,
\u00a0
the Telenor
\u00a0
Board of
\u00a0
Directors
\u00a0
will propose
\u00a0
an ordinary
\u00a0
dividend
\u00a0
of NOK 9.40
\u00a0
per share
\u00a0
to be resolved
\u00a0
by the Annual
General Meeting in May 2023 and paid out in
\u00a0
two tranches of NOK 5.00 and NOK 4.40
\u00a0
per share in May 2023
\u00a0
and October 2023, respectively. The
total ordinary dividend amount proposed for the
\u00a0
financial year 2022 is NOK 13.2 billion.
\u00a0
Following the successful transaction of divesting 30%
\u00a0
of Telenor Fiber AS, Telenor Group has decided to
\u00a0
initiate a 2023-2024 share buyback
programme. The Board of Directors of Telenor
\u00a0
ASA held an extraordinary general meeting on
\u00a0
26 January 2023 asking the General Meeting
\u00a0
for a
share buyback
\u00a0
authorisation.
\u00a0
The programme
\u00a0
size will
\u00a0
be limited
\u00a0
to NOK 3.7
\u00a0
billion and
\u00a0
up to 47
\u00a0
million shares.
\u00a0
Telenor\u2019s shareholder remuneration policy
\u00a0
is to aim for a year-on-year growth in
\u00a0
dividend per share, where the annual dividends
\u00a0
are paid in two
instalments. Buyback of own shares or extraordinary
\u00a0
dividend pay-outs might also be used as a
\u00a0
measure to reach a targeted leverage.
Telenor Group Treasury is responsible for funding
\u00a0
and financial risk management for the parent company
\u00a0
and subsidiaries owned, directly or
indirectly, more than 90% by Telenor ASA.
\u00a0
Subsidiaries owned less than 90% normally have stand-alone
\u00a0
financing and management of financial
risks. Beyond hedging activities, the Group has
\u00a0
limited trading activities.
\u00a0
Liquidity
\u00a0
risk is the
\u00a0
ability
\u00a0
to ensure
\u00a0
appropriate
\u00a0
funding.
\u00a0
The Group
\u00a0
emphasises
\u00a0
financial
\u00a0
flexibility,
\u00a0
and an important
\u00a0
part of this
\u00a0
is to minimise
liquidity risk through ensuring access to a
\u00a0
diversified set of funding sources. Debt issued in
\u00a0
the international capital market is predominately issued
under the existing EMTN programme (Euro Medium
\u00a0
Term Note) to secure longer dated funding
\u00a0
and under existing ECP programme (Euro
Commercial Paper) to secure shorter dated funding
\u00a0
up to 12 months. In addition to
\u00a0
these uncommitted loan programmes, the Norwegian domestic
capital market
\u00a0
is used from
\u00a0
time to time.
\u00a0
Telenor ASA also has a sustainability-linked
\u00a0
committed syndicated revolving credit facility (RCF) of EUR
\u00a0
1.8 billion with maturity in 2025.
\u00a0
The RCF
was undrawn as of 31 December 2022.
\u00a0
When permissible by local rules and regulations,
\u00a0
subsidiaries owned 90% or more are part
\u00a0
of Telenor ASA\u2019s cash management framework
agreements and participate in Telenor ASA\u2019s cash pool
\u00a0
setup. Subsidiaries owned less than 90% have established
\u00a0
separate framework
agreements for banking services.
\u00a0
Telenor
\u00a0
ASA shall
\u00a0
have sufficient
\u00a0
sources of
\u00a0
liquidity
\u00a0
to cover expected
\u00a0
operational
\u00a0
liquidity
\u00a0
needs for
\u00a0
the next
\u00a0
12 months.
\u00a0
Liquidity
\u00a0
requirements
\u00a0
to
fund acquisitions is considered separately.
Maturity profile of the Group\u2019s liabilities (in nominal values)
\u00a0
NOK in millions
31.12.22
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
Not
specified
Interest-bearing
\u00a0
liabilities
Financial Debt
91 267
8 907
14 579
12 498
11 608
7 997
6 701
11 524
717
6 310
-
10 425
-
Other interest-bearing
\u00a0
liabilities
252
252
-
-
-
-
-
-
-
-
-
-
-
Sum of interest-bearing
\u00a0
liabilities
1)
91 518
9 159
14 579
12 498
11 608
7 997
6 701
11 524
717
6 310
-
10 425
-
Non-interest-bearing
\u00a0
liabilities
Trade and other
\u00a0
payables
28 227
28 227
-
-
-
-
-
-
-
-
-
-
-
Other current
\u00a0
non-interest-bearing
liabilities
1 308
1 308
-
-
-
-
-
-
-
-
-
-
-
Derivative
\u00a0
financial instruments
1 841
386
923
224
125
183
-
-
-
-
-
-
-
Other non-current
\u00a0
non-interest-
bearing liabilities
317
-
-
-
-
-
-
-
-
-
-
-
317
Sum of non-interest-bearing
liabilities
31 692
29 920
923
224
125
183
-
-
-
-
-
-
317
Total
123 211
39 080
15 502
12 721
11 733
8 181
6 701
11 524
717
6 310
-
10 425
317
Future interest
\u00a0
payments
9 491
2 030
2 022
1 566
1 043
769
651
445
245
219
155
346
-
Total including
\u00a0
future interest
payments
132 701
41 109
17 524
14 288
12 776
8 950
7 352
11 969
962
6 529
154
10 771
317
NOK in millions
Total as of
31.12.21
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
Not
specified
Interest-bearing
\u00a0
liabilities
Financial Debt
96 008
9 143
8 694
13 236
11 157
11 823
7 840
6 331
11 611
665
5 655
9 854
-
Other interest-bearing
\u00a0
liabilities
134
134
-
-
-
-
-
-
-
-
-
-
-
Sum of interest-bearing
\u00a0
liabilities
96 142
9 276
8 694
13 236
11 157
11 823
7 840
6 331
11 611
665
5 655
9 854
-
Non-interest-bearing
\u00a0
liabilities
Trade and other
\u00a0
payables
32 320
32 320
-
-
-
-
-
-
-
-
-
-
-
Other current
\u00a0
non-interest-bearing
liabilities
1 294
1 294
-
-
-
-
-
-
-
-
-
-
-
Derivative
\u00a0
financial instruments
1 782
675
44
284
216
387
59
54
-
-
63
-
-
Other non-current
\u00a0
non-interest-
bearing liabilities
282
-
-
-
-
-
-
-
-
-
-
-
282
Sum of non-interest-bearing
liabilities
35 677
34 288
44
284
216
387
59
54
-
-
63
-
282
Total
131 818
43 565
8 738
13 520
11 374
12 210
7 898
6 384
11 611
665
5 718
9 854
282
Future interest
\u00a0
payments
8 260
1 322
1 425
1 415
1 056
781
584
462
365
224
196
430
-
Total including
\u00a0
future interest
payments
140 079
44 887
10 163
14 935
12 430
12 991
8 482
6 846
11 976
889
5 913
10 284
282
5)
The maturity tables do not include lease liabilities
\u00a0
related to licences or other lease liabilities. See note
\u00a0
29 for more information on licence commitments
\u00a0
and
lease liabilities.
The Group
\u00a0
is exposed
\u00a0
to interest
\u00a0
rate risk
\u00a0
through funding
\u00a0
and cash
\u00a0
management
\u00a0
activities.
\u00a0
Changes in
\u00a0
interest rates
\u00a0
affect the
\u00a0
fair value
\u00a0
of assets
and liabilities. Interest income and interest expense
\u00a0
in the income statement are influenced by
\u00a0
changes in interest rates in the market. In
\u00a0
2022,
average interest rate for the Group was
\u00a0
1.8%
\u00a0
on interest-bearing liabilities,
\u00a0
excluding lease and licence liabilities (1.6%
\u00a0
in 2021).
The majority of debt issued by the
\u00a0
Group is fixed rate debt. The Group uses interest
\u00a0
rate derivatives to manage interest rate risk
\u00a0
of the debt
portfolio. This typically involves interest rate swaps,
\u00a0
swapping floating interest rates to fixed interest
\u00a0
rates and vice versa.
\u00a0
According to Group Policy, Telenor subsidiaries with
\u00a0
external debt instruments shall maintain a balanced profile
\u00a0
between fixed and floating rate
debt. The portion of the fixed rate shall be between
\u00a0
30% to 70% of external debt. As
\u00a0
of 31 December 2022, the portion of
\u00a0
fixed rate of Group\u2019s debt
was 58% (50%
\u00a0
as of 31. December 2021). For Telenor ASA the
\u00a0
portion
\u00a0
of fixed rate debt as of 31 December
\u00a0
2022 was 58% (55% as of
\u00a0
31. December
2021).
Effect from the interest rate benchmark reform
\u00a0
The Group is exposed to the interest
\u00a0
rate benchmark reform (IBOR reform) through financial
\u00a0
instruments with exposures from EURIBOR, THBFIX
(Thai Baht)
\u00a0
and USD
\u00a0
Libor interest
\u00a0
rate fixings.
\u00a0
In 2022,
\u00a0
dtac has
\u00a0
converted
\u00a0
part of the
\u00a0
exposure
\u00a0
from THBFIX
\u00a0
to THOR (Thai
\u00a0
Overnight
\u00a0
Repurchase
Rate) trough
\u00a0
issuance
\u00a0
of new bonds
\u00a0
or conversion
\u00a0
of legacy
\u00a0
derivatives.
\u00a0
Outside of
\u00a0
these agreements
\u00a0
in Thailand,
\u00a0
there are
\u00a0
no other effects
\u00a0
on the
Group\u2019s consolidated financial statements as a result
\u00a0
of the IBOR reform. The Group has
\u00a0
signed ISDA Fallback Protocol and supplement as part
\u00a0
of
the transition
\u00a0
plan to the
\u00a0
alternative
\u00a0
rates, further
\u00a0
Group is
\u00a0
in dialogue
\u00a0
with counterparties
\u00a0
about the
\u00a0
IBOR reform,
\u00a0
and this has
\u00a0
not resulted
\u00a0
in
changes to
\u00a0
the Group\u2019s
\u00a0
risk management
\u00a0
strategy.
The table
\u00a0
below shows
\u00a0
the financial
\u00a0
instruments
\u00a0
impacted
\u00a0
by interest
\u00a0
rate benchmark
\u00a0
reform as
\u00a0
of 31 December
\u00a0
2022:
Nominal amount
NOK in millions
Bonds
EURIBOR 12 months
72 217
THBFIX 6 months
14 325
86 542
EURIBOR 6 months
21 578
EURIBOR 3 months
12 631
THBFIX 6 months
2 418
USD LIBOR 6 months
-
USD LIBOR 3 months
4 607
41 235
Cross Currency
\u00a0
Swaps
EURIBOR 6 months
11 052
EURIBOR 3 months
14 089
USD LIBOR 3 months
16 004
41 146
Derivative instruments designated as fair value hedging instruments
The majority of debt is issued using fixed
\u00a0
rate bonds. In order to manage interest rate
\u00a0
risk, a portion of the debt may be
\u00a0
swapped to floating interest
rate by using interest rate swaps. Fair value
\u00a0
hedge accounting is applied when hedge accounting
\u00a0
criteria are met. There is an economic relationship
between the hedged items and the hedging instruments,
\u00a0
as the terms of the interest rate
\u00a0
swaps match the terms of the fixed
\u00a0
rate bonds (i.e.,
notional amount, maturity, payment and rate set
\u00a0
dates).
\u00a0
Effectiveness
\u00a0
testing is
\u00a0
performed
\u00a0
using the
\u00a0
hypothetical
\u00a0
derivative
\u00a0
method and
\u00a0
compares
\u00a0
changes in
\u00a0
fair value
\u00a0
of the hedging
\u00a0
instrument
\u00a0
against
the changes in fair value of the
\u00a0
hedged item attributable to the hedged risk. Hedge
\u00a0
ineffectiveness in fair value hedges can arise
\u00a0
from:
\u00a0
\u25cf
Different interest rate curve applied to discount
\u00a0
the hedged items and hedging instruments.
\u00a0
\u25cf
Differences
\u00a0
in timing
\u00a0
of cash flows
\u00a0
of the hedged
\u00a0
items and
\u00a0
hedging instruments.
\u00a0
The table
\u00a0
below shows
\u00a0
the effects
\u00a0
of the Group\u2019s
\u00a0
fair value
hedges.
\u25cf
The effects of the forthcoming IBOR reforms
\u00a0
because these might take effect at a
\u00a0
different time and have a different impact on the
\u00a0
hedged
item (the fixed rate debt) and the hedging instruments (the interest
\u00a0
rate swaps used to hedge the debt).
The change in fair value of the
\u00a0
hedging instrument and the hedged item is recognised
\u00a0
on the line item Net change in fair value
\u00a0
of hedging
instruments and hedged items under net financial
\u00a0
income (expenses) in the income statement, see
\u00a0
also note 9.
\u00a0
Fair value hedging relationships
\u00a0
NOK in millions
2022
2021
Net gain /
\u00a0
(loss) recognised
\u00a0
in the income
\u00a0
statement on
\u00a0
hedged items
4 118
1 280
Net gain /
\u00a0
(loss) recognised
\u00a0
in the income
\u00a0
statement on
\u00a0
hedging instruments
(4 317)
(1 323)
Amount of hedge
\u00a0
ineffectiveness
(200)
(44)
Financial instruments designated as hedging instruments in fair value hedges
\u00a0
are classified on the line items Other non-current
\u00a0
assets and Other
current financial assets in the statement of
\u00a0
financial position, see note 27,
\u00a0
and current and non-current interest-bearing
\u00a0
liabilities, see note 30:
2022
2021
NOK in millions
Assets
Liabilities
Assets
Liabilities
As of 31 December
Nominal amounts
\u00a0
fair value hedge
\u00a0
instruments
37 424
-
42 278
-
Fair values
\u00a0
of fair value
\u00a0
hedge instruments
27
(3 663)
1 071
(120)
The following
\u00a0
table shows
\u00a0
the maturity
\u00a0
profile
\u00a0
of the Group\u2019s
\u00a0
fair value
\u00a0
hedge instruments
\u00a0
(in nominal
\u00a0
values):
NOK in millions
Total
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
As of 31 December
\u00a0
2022
(2 416)
(524)
(528)
(468)
(375)
(256)
(144)
(46)
(19)
(19)
(19)
(19)
As of 31 December
\u00a0
2021
2 148
524
378
369
321
203
119
91
79
13
13
40
The terms
\u00a0
of the fixed
\u00a0
rate receive
\u00a0
leg of the
\u00a0
interest rate
\u00a0
swaps designated
\u00a0
as fair
\u00a0
value hedge
\u00a0
instruments
\u00a0
match the
\u00a0
terms of the
\u00a0
fixed rate
\u00a0
pay
leg of the hedged items. The average interest
\u00a0
rate terms of the floating pay legs of
\u00a0
the interest rate swaps are EURIBOR 3/6 months +
\u00a0
72 basis
points (+
\u00a0
71 basis
\u00a0
points in
\u00a0
2021) for
\u00a0
EUR denominated
\u00a0
swaps,
\u00a0
and THBFIX
\u00a0
+ 146 basis
\u00a0
points (+
\u00a0
140 basis
\u00a0
points in
\u00a0
2021) and
\u00a0
THOR + 143
\u00a0
basis points
(n.a. in 2021) for THB denominated swaps.
The table
\u00a0
below shows
\u00a0
the carrying
\u00a0
amounts of
\u00a0
the Group\u2019s
\u00a0
fair value
\u00a0
hedge items,
\u00a0
which are
\u00a0
recognised
\u00a0
on the line
\u00a0
items Non-current
\u00a0
interest-
bearing liabilities and Current interest-bearing liabilities in the statement
\u00a0
of financial position:
NOK in millions
2022
2021
As of 31 December
Carrying amount
\u00a0
of hedged items
\u00a0
recognised in
\u00a0
the statement
\u00a0
of financial
\u00a0
position
33 004
43 003
Fair value
\u00a0
hedge adjustments
\u00a0
included in the
\u00a0
carrying amount
\u00a0
of the hedged
\u00a0
items
(3 288)
825
Interest rate risk sensitivity analysis
\u00a0
The Group
\u00a0
calculates
\u00a0
the sensitivity
\u00a0
on the change
\u00a0
in fair
\u00a0
value of
\u00a0
assets and
\u00a0
liabilities
\u00a0
of a defined
\u00a0
parallel
\u00a0
shift in
\u00a0
the yield
\u00a0
curve of
\u00a0
the relevant
currencies.
\u00a0
For each
\u00a0
simulation,
\u00a0
the same
\u00a0
shifts in
\u00a0
interest rates
\u00a0
are used
\u00a0
for all currencies.
\u00a0
The sensitivity
\u00a0
analysis
\u00a0
is run only
\u00a0
for assets
\u00a0
and
liabilities
\u00a0
that represent
\u00a0
significant
\u00a0
interest-bearing
\u00a0
positions.
\u00a0
Due to debt
\u00a0
instruments
\u00a0
the net position
\u00a0
is a liability.
\u00a0
Since hedge
\u00a0
accounting
\u00a0
is
applied and interest-bearing debt is measured at amortised cost,
\u00a0
the full effect of change in fair
\u00a0
value is not recognised in the income statement.
This is
\u00a0
shown in
\u00a0
the table
\u00a0
below:
2022
2021
NOK in millions
Yield curve
\u00a0
increase
50 Basis points
Yield curve
\u00a0
decrease
50 Basis points
Yield curve
\u00a0
increase
50 Basis points
Yield curve
\u00a0
decrease
50 Basis points
Reduction (increase)
\u00a0
in fair value
\u00a0
of net liabilities
1 225
(1 278)
1 629
(1 709)
Gain (loss)
\u00a0
in the income
\u00a0
statement
66
(69)
41
(44)
Sensitivity analysis of change in floating interest rates
\u00a0
on net financial items in the income statement:
2022
2021
NOK in millions
Yield curve
\u00a0
increase
50 Basis points
Yield curve
\u00a0
decrease
50 Basis points
Yield curve
\u00a0
increase
50 Basis points
Yield curve
\u00a0
decrease
50 Basis points
Gain (loss)
\u00a0
in the income
\u00a0
statement
(399)
399
(491)
491
The Group is exposed to changes in
\u00a0
the value of NOK relative to other currencies.
\u00a0
The carrying amount of the Group\u2019s net investments
\u00a0
in foreign
entities
\u00a0
and proceeds
\u00a0
from these
\u00a0
investments
\u00a0
varies with
\u00a0
changes in
\u00a0
the foreign
\u00a0
exchange
\u00a0
rate. The
\u00a0
net income
\u00a0
of the Group
\u00a0
is also affected
\u00a0
by
currency fluctuations, as the profit and losses
\u00a0
from foreign operations are translated into NOK
\u00a0
using average exchange rates for the period.
Exchange rate risk related to some net
\u00a0
investments in foreign operations is partly hedged
\u00a0
by issuing debt instruments in the currencies involved or
correlated currencies when this
\u00a0
is considered appropriate. Combinations of money market
\u00a0
instruments (Commercial Paper and bonds) and
derivatives
\u00a0
(foreign
\u00a0
exchange
\u00a0
forward contracts
\u00a0
and cross
\u00a0
currency
\u00a0
swaps) are
\u00a0
used for
\u00a0
this purpose.
\u00a0
Short-term
\u00a0
currency
\u00a0
swaps are
\u00a0
used for
liquidity management purposes. Net investment hedge accounting
\u00a0
is applied when possible.
Exchange
\u00a0
rate risk
\u00a0
also arises
\u00a0
when Telenor
\u00a0
ASA or any
\u00a0
of its subsidiaries
\u00a0
enter into
\u00a0
transactions
\u00a0
or holds
\u00a0
monetary
\u00a0
items denominated
\u00a0
in other
currencies than their own functional currency. In
\u00a0
accordance with Group Policy, committed cash flows in
\u00a0
foreign currency equivalent to NOK 300
million or above are evaluated for hedging.
Financial instruments designated as hedging instruments of net investment in
\u00a0
foreign operations
As of 31 December 2022 and 2021,
\u00a0
material hedging positions are designated as net
\u00a0
investment hedges.
There is an economic relationship between the hedged items
\u00a0
and the hedging instruments as the net
\u00a0
investment creates a translation risk that will
match the
\u00a0
foreign
\u00a0
exchange
\u00a0
risk on the
\u00a0
debt and
\u00a0
derivatives
\u00a0
designated
\u00a0
as hedging
\u00a0
instruments.
Net investment hedging is mainly applied in currencies that
\u00a0
have well-functioning financial markets, but the Group
\u00a0
may also designate debt in
correlated currencies as hedging instruments to hedge foreign
\u00a0
exchange risk.
The Group has established hedge ratios to match
\u00a0
the underlying risk of the hedging instruments
\u00a0
with the hedged risk component. Hedge
ineffectiveness may arise when the amount of
\u00a0
the investment in the foreign subsidiary becomes
\u00a0
lower than the amount of the debt
\u00a0
and derivatives
designated as hedging instruments. There was no
\u00a0
ineffectiveness in the years ending 31 December 2022 and 2021.
For additional information and a reconciliation of the
\u00a0
net investment hedge balance in equity, see
\u00a0
note 28.
\u00a0
Net investment hedging relationships
NOK in millions
2022
2021
Amount recognised
\u00a0
directly to other
\u00a0
comprehensive
\u00a0
income (OCI)
(1 402)
2 447
Amount reclassified
\u00a0
from OCI to the
\u00a0
income statement
\u00a0
on disposal
233
-
Net investment hedging was performed for the
\u00a0
investment in Bangladesh using USD denominated instruments,
\u00a0
but hedging was discontinued due
to loss of economic relationship during 2022.
\u00a0
As of 31 December 2022, the remaining balance included in
\u00a0
the net investment hedge reserve was
Interest-bearing debt and
\u00a0
derivatives designated as hedging instruments in net
\u00a0
investment hedges (only effective part of instruments is
\u00a0
included):
2022
2021
NOK in millions
Debt
Derivatives
Debt
Derivatives
As of 31 December
Nominal amounts
\u00a0
net investment
\u00a0
hedge instruments
(50 533)
8 372
(54 232)
9 184
Fair value
\u00a0
net investment
\u00a0
hedge instruments
(44 000)
(974)
(55 997)
(1 273)
Debt designated as hedging instruments in net
\u00a0
investment hedges are recognised on the line
\u00a0
items Non-current interest-bearing
\u00a0
liabilities and
Current interest-bearing
\u00a0
liabilities in the statement of financial position.
\u00a0
Classification
\u00a0
of derivatives
\u00a0
designated
\u00a0
for net investment
\u00a0
hedge in
\u00a0
the consolidated
\u00a0
statement
\u00a0
of financial
\u00a0
position:
NOK in millions
2022
2021
As of 31 December
Other non-current
\u00a0
assets
713
27
Other financial
\u00a0
current assets
2
320
Non-current non-interest-bearing
\u00a0
financial liabilities
(1 306)
(950)
Current non-interest-bearing
\u00a0
liabilities
(382)
(669)
Fair value net
\u00a0
investment hedge
\u00a0
instruments
(974)
(1 273)
The following
\u00a0
table shows
\u00a0
the maturity
\u00a0
profile (in
\u00a0
nominal values)
\u00a0
of the Group\u2019s
\u00a0
net investment
\u00a0
hedge instruments
\u00a0
(only effective
\u00a0
part of
instruments is included):
NOK in millions
Total
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
As of 31 December
\u00a0
2022
(44 646)
(6 084)
(2 766)
(1 284)
(6 800)
(2 653)
(4 194)
(8 233)
(130)
(4 137)
(105)
(8 259)
As of 31 December
\u00a0
2021
(49 304)
(5 688)
(1 903)
(3 707)
(2 449)
(7 126)
(3 057)
(4 223)
(8 259)
(134)
(4 372)
(8 386)
Average currency rates in cross currency swaps
\u00a0
designated as net investment hedge instruments were
\u00a0
NOK/USD n.a. (8.57
\u00a0
in 2021), USD/EUR 1.15
(1.16 in 2021), SEK/EUR 10.47
\u00a0
(10.47 in 2021) and NOK/EUR 10.83
\u00a0
(10.83 in 2021) in 2022. In 2022, average currency
\u00a0
rates in foreign exchange contracts
designated as net investment hedge instruments were
\u00a0
NOK/SEK 0.95 (1.00 in 2021), NOK/EUR 10.57 (9.98
\u00a0
in 2021), USD/EUR n.a. (1.16
\u00a0
in 2021),
USD/MYR 0.22
\u00a0
(0.24 in
\u00a0
2021) and
\u00a0
USD/THB 0.03
\u00a0
(0.03 in 2021).
Exchange
\u00a0
rate risk
\u00a0
sensitivity
\u00a0
analysis
\u00a0
This analysis does not consider correlation between
\u00a0
currencies. Empirical studies confirm substantial diversification effect across
\u00a0
the currencies
that the Group
\u00a0
is exposed
\u00a0
to.
Effects on net currency gains (losses)
Currency gains and losses on monetary items
\u00a0
in foreign currency are recognised in the
\u00a0
income statements of Telenor ASA and its
\u00a0
subsidiaries. Net
currency
\u00a0
gains (losses)
\u00a0
in foreign
\u00a0
subsidiaries
\u00a0
are translated
\u00a0
to NOK in
\u00a0
the consolidated
\u00a0
income statement.
\u00a0
The table
\u00a0
below shows
\u00a0
the effect
\u00a0
on
consolidated net currency losses of 10% depreciation
\u00a0
in functional currencies in the Group, keeping other currencies
\u00a0
constant (only significant
exposures
\u00a0
are included
\u00a0
in the table):
Monetary Item
\u00a0
Currency
2022
2021
NOK in millions
EUR
SEK
USD
Other
EUR
SEK
USD
Other
Depreciating
\u00a0
Functional Currency
NOK
-
(510)
(677)
(104)
(146)
(443)
(1 212)
(116)
Effects due to foreign exchange translations on other comprehensive income
Translation
\u00a0
of subsidiaries
\u00a0
from their
\u00a0
functional
\u00a0
currencies
\u00a0
into the presentation
\u00a0
currency
\u00a0
of the Group
\u00a0
(NOK) will
\u00a0
impact the
\u00a0
Group\u2019s other
comprehensive income (OCI) and equity. If NOK
\u00a0
had weakened by 10% against all other
\u00a0
functional currencies of the Group, the change
\u00a0
in the
carrying amount of consolidated equity as of 31
\u00a0
December 2022, including effects of net investment
\u00a0
hedge, would have been an increase of
approximately
\u00a0
NOK 2.1
\u00a0
billion (increase
\u00a0
of NOK 2.2
\u00a0
billion as
\u00a0
of 31 December
\u00a0
2021).
The table
\u00a0
below shows
\u00a0
the impact
\u00a0
on OCI of
\u00a0
net investment
\u00a0
hedge (NIH)
\u00a0
instruments
\u00a0
if the functional
\u00a0
currency
\u00a0
weakened
\u00a0
by 10%.
2022
2021
NOK in millions
EUR
SEK
USD
Other
EUR
SEK
USD
Other
Currency effect
\u00a0
on OCI (before
\u00a0
tax) of NIH instruments
NOK
(2 420)
(1 211)
-
(585)
(2 474)
(1 128)
(267)
(636)
Effect on other
\u00a0
comprehensive
\u00a0
income (OCI)
-
-
-
(4 216)
-
-
-
(4 505)
Effects due to foreign exchange translations on net income
\u00a0
Translation
\u00a0
of net income
\u00a0
from subsidiaries
\u00a0
with functional
\u00a0
currency
\u00a0
other than
\u00a0
NOK, also
\u00a0
represents
\u00a0
a currency
\u00a0
exposure
\u00a0
for the Group\u2019s
\u00a0
reported
figures.
\u00a0
If the presentation
\u00a0
currency
\u00a0
(NOK) had
\u00a0
weakened
\u00a0
/ strengthened
\u00a0
by 10% against
\u00a0
all other
\u00a0
currencies
\u00a0
included
\u00a0
in the analysis,
\u00a0
net income
\u00a0
for
the Group would have been NOK 0.6
\u00a0
billion higher / lower in 2022 (NOK 0.3
\u00a0
billion in 2021).
\u00a0
Credit risk is the loss that the Group
\u00a0
would suffer if a counterparty fails to
\u00a0
perform its financial obligations. The Group considers its
\u00a0
maximum
exposure
\u00a0
to credit
\u00a0
risk to be
\u00a0
as follows:
Maximum credit exposure
NOK in millions
2022
2021
Cash and cash
\u00a0
equivalents
9 929
15 223
Bonds and commercial
\u00a0
papers > 3 months
\u00a0
(note 27)
277
327
Financial derivatives
\u00a0
(note 27)
1 017
1 333
Current interest-bearing
\u00a0
receivables
\u00a0
\u2013 deferred payment
\u00a0
from disposal
\u00a0
(note 19)
-
998
Trade and other
\u00a0
current financial
\u00a0
receivables
\u00a0
(note 19)
16 480
17 286
The Group\u2019s credit risks largely arise from
\u00a0
trade receivables, financial derivatives and cash and
\u00a0
cash equivalents.
\u00a0
Credit risk
\u00a0
from cash
\u00a0
and cash
\u00a0
equivalents
\u00a0
is managed
\u00a0
by the Group\u2019s
\u00a0
Treasury
\u00a0
department
\u00a0
in accordance
\u00a0
with the
\u00a0
principles
\u00a0
defined in
\u00a0
the Group
Policy Treasury. Cash deposits are only made with approved
\u00a0
counterparties and in accordance with approved credit limits per
\u00a0
counterparty.
Counterparty
\u00a0
credit limits
\u00a0
for core
\u00a0
banks are
\u00a0
reviewed
\u00a0
by the Group\u2019s
\u00a0
Board of
\u00a0
Directors
\u00a0
on a regular
\u00a0
basis. The
\u00a0
limits are
\u00a0
set to minimise
\u00a0
the
concentration of risks and therefore mitigate financial loss
\u00a0
through a counterparty\u2019s potential payment default.
\u00a0
Credit risk arising from financial derivatives and
\u00a0
cash deposits is managed through diversification, internal
\u00a0
risk assessment and credit scoring, as
well as credit risk mitigation tools. The
\u00a0
main risk mitigation tools include legal netting and
\u00a0
collateral agreements.
\u00a0
Credit risk
\u00a0
related to
\u00a0
trade receivables
\u00a0
is assessed
\u00a0
to be limited
\u00a0
due to the
\u00a0
high number
\u00a0
of customers
\u00a0
in the Group\u2019s
\u00a0
customer
\u00a0
base. As
\u00a0
such, no
further credit
\u00a0
risk provision
\u00a0
is required
\u00a0
in excess
\u00a0
of the normal
\u00a0
provision
\u00a0
for bad
\u00a0
and doubtful
\u00a0
receivables.
\u00a0
See note
\u00a0
19 for information
\u00a0
on
receivables in terms of age distribution and
\u00a0
provision for bad debt. Credit risk related to
\u00a0
sale of handsets on instalment plans, where
\u00a0
the effect of
discounting is considered material, is also assessed
\u00a0
to be limited. Credit risk related to
\u00a0
such arrangements are embedded in the discount rate and
reflected
\u00a0
as reduced
\u00a0
revenue.
As of 31
\u00a0
December
\u00a0
2022, NOK
\u00a0
264 million
\u00a0
was posted
\u00a0
as cash collateral
\u00a0
(receivable).
\u00a0
As of 31 December
\u00a0
2021, NOK
\u00a0
658 million
\u00a0
was posted
\u00a0
as cash
collateral (receivable).
NOTE 33
Guarantees
NOK in millions
2022
2021
Guarantee
\u00a0
obligations
\u00a0
as of 31
\u00a0
December
1 522
2 475
Telenor has provided various types of guarantees
\u00a0
to external parties, including guarantees relating to
\u00a0
partnership agreements, guarantee for the
pension funds
\u00a0
and various
\u00a0
guarantees
\u00a0
for taxes.
\u00a0
Purchased
\u00a0
bank guarantees
\u00a0
are not shown
\u00a0
in the table.
NOTE 34
Consolidation and group companies
\u00a0
Accounting policies
The consolidated financial statements include the financial
\u00a0
statements of Telenor ASA and entities controlled
\u00a0
by Telenor ASA. Control normally
exists when
\u00a0
the Group
\u00a0
has more
\u00a0
than 50%
\u00a0
of the voting
\u00a0
power through
\u00a0
ownership
\u00a0
or agreements,
\u00a0
except where
\u00a0
non-controlling
\u00a0
interests prevent
the exercise of control. Subsidiaries have the
\u00a0
same reporting periods as the parent company
\u00a0
and use consistent accounting policies. Intercompany
transactions, balances, revenues, expenses and unrealised
\u00a0
internal profit or losses are eliminated on consolidation. Non-controlling
\u00a0
interests in
subsidiaries are presented within equity separately from the equity attributable
\u00a0
to the owners of the parent, refer
\u00a0
to note 28. Non-controlling
interests
\u00a0
have been
\u00a0
measured
\u00a0
at the proportionate
\u00a0
fair value
\u00a0
of net identifiable
\u00a0
assets at
\u00a0
the date
\u00a0
of the business
\u00a0
combination
\u00a0
and share
\u00a0
of
changes in
\u00a0
equity since
\u00a0
the date
\u00a0
of the business
\u00a0
combination.
Shares in subsidiaries
Office
in % 2022
in % 2021
Telenor Networks Holding AS
Norway
100.0
100.0
Telenor Global Shared Services AS
\u00a0
Norway
100.0
100.0
Telenor
\u00a0
Communication
\u00a0
II AS
Norway
100.0
100.0
Telenor Mobile Holding AS
\u00a0
Norway
100.0
100.0
Norway
100.0
100.0
Telenor Forsikring AS
Norway
100.0
100.0
Telenor Maritime AS 1)
Norway
98.9
98.9
Norway
100.0
100.0
Cinclus Technology AS
\u00a0
Norway
100.0
100.0
Telenor Digital AS 2)
Norway
0.0
100.0
Telenor Real Estate AS
Norway
100.0
100.0
1)
The remaining
\u00a0
1.1% of shares
\u00a0
in Telenor Maritime
\u00a0
AS are owned by
\u00a0
Telenor Communication
\u00a0
II AS.
2)
Telenor Digital
\u00a0
AS is merged
\u00a0
with Telenor
\u00a0
Linx AS which
\u00a0
is owned by Telenor
\u00a0
Networks Holding
\u00a0
AS in 2022.
Shares in subsidiaries
\u00a0
owned through
\u00a0
subsidiaries
Office
in % 2022
in % 2021
Telenor Networks Holding AS
Norway
100.0
100.0
Telenor Linx AS
Norway
100.0
100.0
Telenor
\u00a0
Svalbard
\u00a0
AS
Norway
100.0
100.0
Norway
100.0
100.0
Telenor Nordic Towers AS
Norway
100.0
100.0
Telenor Satellite AS
Norway
100.0
100.0
Norway
100.0
Telenor Communication II AS
Telenor Financial Services AS
5)
Norway
0.0
100.0
Singapore
100.0
100.0
SnT East
\u00a0
Holding
\u00a0
AS
Norway
100.0
100.0
Telenor
\u00a0
India Private
\u00a0
Ltd
India
100.0
100.0
Norkring Belgi\u00eb N.V.
Belgium
75.0
75.0
Norway
100.0
100.0
Telenor
\u00a0
Marketplace
\u00a0
Invest AS
Norway
100.0
100.0
Telenor South Asia Investment Pte Ltd
6)
Singapore
100.0
0.0
Telenor Mobile Holding AS
Telenor
\u00a0
Mobile Communications
\u00a0
AS
Norway
100.0
100.0
Telenor Danmark Holding A/S
Denmark
100.0
100.0
Sweden
100.0
100.0
Telenor Connexion AB
\u00a0
Sweden
100.0
100.0
Canal Digital
\u00a0
Finland Oy
Finland
100.0
100.0
Telenor Finland Holding Oy
Finland
100.0
100.0
Telenor Maritime AS
Telenor
\u00a0
Maritime
\u00a0
Inc
USA
100.0
100.0
Telenor
\u00a0
Maritime
\u00a0
AB
Sweden
100.0
100.0
Telenor
\u00a0
Maritime
\u00a0
Pte
Singapore
100.0
100.0
Telenor
\u00a0
Maritime
\u00a0
Oy
Finland
100.0
100.0
Telenor Real Estate AS
Telenor Eiendom Harelokken AS
Norway
100.0
100.0
Norway
100.0
100.0
Telenor
\u00a0
M\u00f8re og Romsdal
\u00a0
og Tr\u00f8ndelag
\u00a0
2 AS
Norway
100.0
100.0
Telenor Vestlandet og Rogaland 2 AS
Norway
100.0
100.0
Telenor Agder Vestfold og Telemark 2 AS
Norway
100.0
100.0
Telenor Viken og Innlandet 2 AS
Norway
100.0
100.0
Telenor
\u00a0
\u00d8vre Strandgate
\u00a0
5 2 AS
Norway
100.0
100.0
Telenor L\u00e5veveien 55 AS
Norway
100.0
100.0
Telenor Jel\u00f8y Radio AS
Norway
100.0
100.0
Telenor Tryvann Radio AS
Norway
100.0
100.0
Telenor Festekontrakter AS
Norway
100.0
100.0
Telenor Linx AS
2)
Norway
100.0
100.0
1)
The company was presented as Telenor Global Services
\u00a0
AS earlier.
2)
Telenor Digital AS is merged with Telenor Linx AS in
\u00a0
2022.
3)
The company was presented as Telenor Tower Holding
\u00a0
AS earlier.
4)
The company is
\u00a0
newly established
\u00a0
in 2022.
5)
The company is
\u00a0
merged with Telenor
\u00a0
Communication
\u00a0
II AS in 2022.
6)
The company is sold from Telenor Mobile Communications
\u00a0
AS to Telenor Communication II AS in 2022.
Other significant
\u00a0
subsidiaries
\u00a0
(owned through
\u00a0
holding companies)
Office
Denmark
Telenor
\u00a0
Pakistan
\u00a0
(Private)
\u00a0
Ltd.
Pakistan
Total Access Communications Plc. (dtac)
Thailand
Bangladesh
Unitech Wireless Private Limited
\u00a0
India
DNA Plc
Finland
Telenor consolidated Digi before it was merged with Celcom in November 2022
\u00a0
and reported as an associate. Digi was listed on Bursa Malaysia
Securities Berhad and the shares in Digi were widely dispersed. Telenor owned 49%
\u00a0
of the shares, and 98% of the shares had to be present at
the General Meeting for Telenor not to have the majority of the votes. As a
\u00a0
consequence of this and based on experience from past General
Meetings, Telenor had the power to direct Digi\u2019s activities. The assessment
\u00a0
was that the ability to exercise control was upheld through a
majority of the votes at the General Meeting and at the Board of Directors
\u00a0
meetings. The consolidation of Digi based on de facto control was
assessed on an ongoing basis.
.
NOTE 35
Associated companies and joint arrangements
Associated companies are normally those entities where Telenor
\u00a0
has between 20 to 50 percent ownership. Joint
arrangements are those entities where Telenor shares control with
\u00a0
other parties. On 30 November 2022, the
subsidiary Digi in Malaysia merged with Celcom. This resulted
\u00a0
in a derecognition as a subsidiary of Telenor with a
gain of NOK 32.9 billion. After the merger, CelcomDigi is an associated
\u00a0
company with Telenor having an ownership
percentage of 33.1%.
Accounting policies
\u00a0
Associates
\u00a0
are those
\u00a0
entities
\u00a0
where Telenor
\u00a0
has significant
\u00a0
influence,
\u00a0
but not control
\u00a0
or joint control,
\u00a0
usually
\u00a0
between
\u00a0
20 to 50 percent
\u00a0
voting
power. Joint
\u00a0
ventures are
\u00a0
those entities
\u00a0
where unanimous
\u00a0
consent
\u00a0
is required
\u00a0
by the owners
\u00a0
on important
\u00a0
decision
\u00a0
and where
\u00a0
the parties
\u00a0
have
rights to net assets. Interests in joint
\u00a0
ventures and associates are accounted for using
\u00a0
the equity method. The investments are initially
\u00a0
recognised
at cost (including transaction costs) and subsequently
\u00a0
adjusted for the share of profits and
\u00a0
losses, dividends received and impairment. The profit
and losses
\u00a0
are presented
\u00a0
on a separate
\u00a0
line in the
\u00a0
income statement.
An investment
\u00a0
is a joint
\u00a0
operation
\u00a0
when unanimous
\u00a0
consent is
\u00a0
required
\u00a0
by the owners
\u00a0
on important
\u00a0
decisions
\u00a0
and Telenor
\u00a0
and the parties
\u00a0
have
rights to
\u00a0
specific
\u00a0
assets and
\u00a0
obligations.
\u00a0
These entities
\u00a0
are consolidated
\u00a0
on a line-by-line
\u00a0
basis with
\u00a0
a share of
\u00a0
revenues and
\u00a0
costs, and
\u00a0
the specific
assets and
\u00a0
liabilities
\u00a0
or the proportionate
\u00a0
share of
\u00a0
jointly
\u00a0
owned assets
\u00a0
and liabilities.
For investments
\u00a0
where financial
\u00a0
statements
\u00a0
are not
\u00a0
available
\u00a0
at the time
\u00a0
Telenor publishes
\u00a0
its report,
\u00a0
the share
\u00a0
of net income
\u00a0
is recognised
\u00a0
with a
one quarter
\u00a0
lag. Adjustments
\u00a0
are made
\u00a0
for significant
\u00a0
transactions
\u00a0
or events
\u00a0
known in
\u00a0
the market.
\u00a0
To ensure
\u00a0
consistency,
\u00a0
the Annual
\u00a0
Report is
\u00a0
not
updated in situations where the financial statements
\u00a0
for the investee are made available after fourth
\u00a0
quarter and before the issuance of the
\u00a0
Annual
Report, unless
\u00a0
the transactions
\u00a0
or events
\u00a0
are significant.
Associated companies
\u00a0
and joint ventures
NOK in millions
2022
2021
Balance as of 1 January
5 683
6 417
Additions
35 089
393
Disposals
1)
(432)
3
Share of
\u00a0
net income
\u00a0
(losses)
2)
(232)
(480)
Share of
\u00a0
other comprehensive
\u00a0
income
46
79
Dividends received
(575)
(532)
Translation differences
106
(198)
Balance as of 31 December
39 686
5 683
Of which
\u00a0
investment
\u00a0
in CelcomDigi
34 436
-
Of which investment in Telenor Microfinance Bank
\u00a0
Limited
5)
828
952
Of which investment in Carousell
6)
2 660
2 619
Of which
\u00a0
investment
\u00a0
in Allente
1 369
1 420
Of which
\u00a0
investment
\u00a0
in others
393
692
1)
Mainly relates to the disposal of Wave Money during
\u00a0
2022.
2)
Share of net income (loss) includes the Group\u2019s share
\u00a0
of net income (loss) after taxes, amortisation of excess
\u00a0
values, impairments, and adjustment for
differences in accounting policies.
\u00a0
3)
Of which NOK 0.3 billion from Allente and NOK 0.3
\u00a0
billion from CelcomDigi in 2022, and NOK 0.5 billion
\u00a0
from Allente in 2021.
\u00a0
4)
Of which NOK 34.1 billion relates to the market
\u00a0
value of the investment retained on disposal of
\u00a0
Digi.
5)
Of which allocated to goodwill NOK 0.8 billion in
\u00a0
2022 and NOK 0.9 billion in 2021.
6)
Of which allocated to goodwill NOK 2.7 billion in 2022
\u00a0
and NOK 2.1 billion in 2021.
As announced in June 2021, Telenor and Axiata
\u00a0
Group Berhad entered into an agreement to
\u00a0
merge Digi.Com Berhad and Celcom Axiata Berhad
\u00a0
in
Malaysia.
\u00a0
The merger
\u00a0
of the telecommunication
\u00a0
operations
\u00a0
of Celcom
\u00a0
and Digi
\u00a0
in Malaysia
\u00a0
was completed
\u00a0
on 30 November
\u00a0
2022. On
\u00a0
completion,
Digi issued 3.96 billion shares to Celcom\u2019s owner
\u00a0
Axiata in addition to making cash payments
\u00a0
of NOK 5.4 billion. The share issue
\u00a0
diluted Telenor\u2019s
ownership to 32.5%, Telenor lost control
\u00a0
over Digi, and Digi was deconsolidated and
\u00a0
recognised as an associated company as of 30
\u00a0
November
2022. As part of the transaction to
\u00a0
bring Telenor and Axiata to equal ownership, Telenor acquired
\u00a0
at the same date 73.4 million shares
\u00a0
from Axiata
for an amount of NOK 667 million. Telenor\u2019s
\u00a0
ownership after the transaction in CelcomDigi is 33.1%. The
\u00a0
gain of NOK 32.9 billion was recognised
\u00a0
on
the date
\u00a0
of losing
\u00a0
control over
\u00a0
Digi based
\u00a0
on a market
\u00a0
value of
\u00a0
the combined
\u00a0
entity as
\u00a0
of first
\u00a0
day of trading
\u00a0
i.e., 1 December
\u00a0
2022, which
\u00a0
was NOK
34.1 billion
\u00a0
for Telenor\u2019s
\u00a0
interest in
\u00a0
the new company
\u00a0
CelcomDigi.
\u00a0
See note 12
\u00a0
for more
\u00a0
information.
During 2022, Telenor injected NOK 0.2 billion
\u00a0
representing its proportionate share of the capital
\u00a0
into Telenor Microfinance Bank Limited (TMB).
Share of
\u00a0
net loss for
\u00a0
2022 includes
\u00a0
share of
\u00a0
losses related
\u00a0
to TMB of
\u00a0
NOK 0.2
\u00a0
billion (NOK
\u00a0
0.3 billion
\u00a0
in 2021).
As announced on 17 January 2022, Telenor
\u00a0
entered into an agreement with Yoma Strategic
\u00a0
to sell the Group's 51%
\u00a0
ownership share in Digital
Money Myanmar Limited (Wave Money) to Yoma MFS
\u00a0
Holdings Pte. Ltd, a subsidiary of Yoma Strategic.
\u00a0
The transaction was closed on 7 December
2022 for
\u00a0
a cash consideration
\u00a0
of NOK 0.4
\u00a0
billion.
\u00a0
The loss recognised
\u00a0
on disposal
\u00a0
was NOK 35
\u00a0
million during
\u00a0
2022.
In 2022,
\u00a0
Telenor\u2019s
\u00a0
economic
\u00a0
interest
\u00a0
in Carousell
\u00a0
was diluted
\u00a0
following
\u00a0
new capital
\u00a0
investment
\u00a0
of USD 15
\u00a0
million.
\u00a0
The loss of
\u00a0
NOK 36 million
\u00a0
was
recognised during 2022 on deemed
\u00a0
disposal.
\u00a0
As of 31 December 2022, Telenor\u2019s economic
\u00a0
interest in Carousell stands at 32.4%.
\u00a0
During 2021, new
capital
\u00a0
of USD 100
\u00a0
million was
\u00a0
raised by
\u00a0
Carousell
\u00a0
leading
\u00a0
to the dilution
\u00a0
of Telenor\u2019s
\u00a0
economic
\u00a0
interest
\u00a0
in Carousell
\u00a0
from 37.4%
\u00a0
to 33.6%
\u00a0
as of 31
December 2021. The gain of NOK 21 million
\u00a0
was recognised during 2021.
Significant associates
\u00a0
and joint ventures
CelcomDigi is an associated company where Telenor controls
\u00a0
33.1% of the shares and voting rights.
\u00a0
The associate is accounted for using the
\u00a0
equity
method. CelcomDigi is a telecommunication company, listed
\u00a0
on Bursa Malaysia Berhad and became the
\u00a0
largest mobile network operator
\u00a0
in
Malaysia through a merger between the former Telenor
\u00a0
subsidiary Digi and Celcom Axiata Berhad in November 2022.
\u00a0
Telenor share of
CelcomDigi\u2019s
\u00a0
market value
\u00a0
amounted
\u00a0
to NOK 34.7
\u00a0
billion as
\u00a0
of 31 December
\u00a0
2022.
The Group
\u00a0
is not aware
\u00a0
of significant
\u00a0
restrictions
\u00a0
limiting
\u00a0
the ability
\u00a0
of CelcomDigi
\u00a0
to transfer
\u00a0
funds to
\u00a0
its shareholders.
\u00a0
For example,
\u00a0
under the
form of dividends,
\u00a0
repayment
\u00a0
of advances
\u00a0
or loans
\u00a0
made.
As the financial
\u00a0
quarterly
\u00a0
results of
\u00a0
the listed
\u00a0
company CelcomDigi
\u00a0
will not
\u00a0
always be
\u00a0
published
\u00a0
at the time
\u00a0
Telenor reports
\u00a0
its quarterly
\u00a0
results,
Telenor will
\u00a0
include the
\u00a0
share of
\u00a0
profits from
\u00a0
CelcomDigi
\u00a0
with a one-quarter
\u00a0
lag. This
\u00a0
means that
\u00a0
the fourth
\u00a0
quarter results
\u00a0
of CelcomDigi
\u00a0
consisting
of December
\u00a0
2022 will
\u00a0
be included
\u00a0
in the Telenor\u2019s
\u00a0
Q1 2023
\u00a0
report.
The following table sets forth the summarised
\u00a0
financial information of CelcomDigi. The figures reflect the
\u00a0
opening balance for CelcomDigi on 1
December 2022, adjusted for dividend received by Telenor
\u00a0
in December 2022. The financial information includes
\u00a0
the preliminary allocation of the
excess values recognised as part of the merger, and
\u00a0
reconciliation with the carrying amount of the investment
\u00a0
for the Group.
NOK in millions
2022
Statement of financial position
77 836
Current assets excluding cash and cash equivalents
9 593
Cash and
\u00a0
cash equivalents
7 744
Non-current non-interest-bearing
\u00a0
liabilities
(6 978)
Non-current interest-bearing liabilities
(33 310)
Current non-interest-bearing
\u00a0
liabilities
(8 194)
Total equity
46 691
Group's share of equity
\u00a0
15 455
Goodwill
\u00a0
related to
\u00a0
the Group's
\u00a0
investment
18 981
Carrying
\u00a0
amount of
\u00a0
investment
34 436
Dividends received
289
Allente
Allente
\u00a0
Group AB
\u00a0
(Allente)
\u00a0
is a joint
\u00a0
venture where
\u00a0
Telenor
\u00a0
controls
\u00a0
50% of the
\u00a0
shares and
\u00a0
the voting
\u00a0
rights. The
\u00a0
joint venture
\u00a0
is accounted
\u00a0
for using
the equity method. Allente is a Nordic TV
\u00a0
distributor broadcasting via satellite and internet TV,
\u00a0
to customers within Norway, Sweden, Denmark, and
Finland. Allente was established in May 2020 through
\u00a0
a merger between the former Telenor subsidiary Canal
\u00a0
Digital and Nordic Entertainment
The following
\u00a0
table sets
\u00a0
forth summarised
\u00a0
financial
\u00a0
information
\u00a0
of Allente,
\u00a0
including
\u00a0
excess values
\u00a0
from the
\u00a0
merger in
\u00a0
2020, and
\u00a0
reconciliation
\u00a0
with
the carrying
\u00a0
amount of
\u00a0
the investment
\u00a0
for the Group:
NOK in millions
2022
2021
Statement of comprehensive income
Revenue
6 472
6 826
EBITDA
1 181
593
Depreciation
\u00a0
and amortisation
(526)
(663)
(62)
-
(143)
46
Net income
470
(25)
Other comprehensive
\u00a0
income(loss)
83
148
Total comprehensive
\u00a0
income (loss)
553
123
Group's ownership
\u00a0
in %
50
50
Group's share of net income (loss) from continuing operations
235
(12)
Group's share of other comprehensive income (loss)
42
74
Group's share of total comprehensive income (loss)
277
61
NOK in millions
2022
2021
Statement of financial position
4 401
4 910
Current assets excluding cash and cash equivalents
1 781
1 647
Cash and
\u00a0
cash equivalents
144
191
Non-current non-interest-bearing
\u00a0
liabilities
(442)
(514)
Non-current interest-bearing liabilities
(1 948)
(2 252)
Current non-interest-bearing
\u00a0
liabilities
(1 971)
(1 940)
Total equity
1 964
2 042
Group's share of equity
\u00a0
982
1 021
Goodwill
\u00a0
related to
\u00a0
the Group's
\u00a0
investment
387
399
Carrying
\u00a0
amount of
\u00a0
investment
1 369
1 420
Dividends received
285
501
.
Joint operations
The Group is part of four joint
\u00a0
arrangements for networks sharing in Sweden, Denmark,
\u00a0
and Finland. These joint arrangements are structured
through separate
\u00a0
vehicles.
\u00a0
The activities
\u00a0
are designed
\u00a0
for the provision
\u00a0
of output
\u00a0
to the investors
\u00a0
and hence
\u00a0
these arrangements
\u00a0
are classified
\u00a0
as
joint operations.
Joint Operation
Description
Ownership
\u00a0
interest in
\u00a0
%
3G Infrastructure
\u00a0
Services
AB
Joint operation with the mobile operator 3
\u00a0
in Sweden
1)
50
Net4Mobility HB
Joint operation under partnership agreement with the
\u00a0
mobile operator Tele2 Sverige AB in
Sweden
1)
50
TT Netv\u00e6rket P/S
Joint operation
\u00a0
with the
\u00a0
mobile operator
\u00a0
TeliaSonera
\u00a0
Mobile Holding
\u00a0
AB in Denmark
50
Suomen Yhteisverkko
\u00a0
Oy
Joint operations with mobile Operator Telia Finland Oy
\u00a0
in Finland
2)
49
.
1)
Under Swedish law, all partners in a partnership are
\u00a0
jointly and severally liable for all obligations in a partnership.
2)
According to the shareholder\u2019s agreement, both partners
\u00a0
in are jointly and severally liable for all obligations
\u00a0
in the joint undertaking.
NOTE 36
Related parties
Telenor ASA is 53.97% owned by the Kingdom of Norway represented
\u00a0
through the Ministry of Trade, Industry and
Fisheries (MTIF). Transactions between Telenor and Norwegian authorities
\u00a0
are therefore regarded as related party
transactions. Further, transactions between Telenor and
\u00a0
its associated companies and joint ventures are regarded
as related party transactions. All transactions with these related parties
\u00a0
are based on the arm\u2019s length principle.
Transaction
\u00a0
with Norwegian
\u00a0
authorities
The Norwegian
\u00a0
telecommunications
\u00a0
market is
\u00a0
governed
\u00a0
by the Electronic
\u00a0
Communications
\u00a0
Act of 4
\u00a0
July 2003
\u00a0
and other
\u00a0
regulations
\u00a0
issued
pursuant to this Act. The Group provides
\u00a0
designated Universal Service Obligations (USO) through an
\u00a0
agreement between the Group and the
Norwegian Ministry
\u00a0
of Local Government and Regional Development (MLGRD).
\u00a0
The USO obligation entails among other things
\u00a0
the provision of
public voice telephony and basic access to internet
\u00a0
to all households and companies. Telenor is
\u00a0
imposed USO obligations to provide text telephony
services
\u00a0
for the deaf
\u00a0
and hearing
\u00a0
impaired,
\u00a0
but does
\u00a0
not receive
\u00a0
any compensation
\u00a0
for providing
\u00a0
the USO services.
\u00a0
In addition, Telenor was in 2022 and 2021
\u00a0
subject to Special Service Obligations (SSO), mainly
\u00a0
related to security and emergency following an
agreement
\u00a0
between
\u00a0
the Norwegian
\u00a0
Ministry
\u00a0
of Justice
\u00a0
and Public
\u00a0
Security and
\u00a0
Telenor Coastal
\u00a0
Radio. In
\u00a0
2022 and
\u00a0
2021, NOK
\u00a0
97 million
\u00a0
and NOK 93
million, respectively, was received as compensation under
\u00a0
this agreement.
\u00a0
Telenor may also receive compensation for the
\u00a0
obligations to fulfil additional requirements on the
\u00a0
network to serve national security issues and
other statutory
\u00a0
services.
\u00a0
In 2022
\u00a0
and 2021,
\u00a0
a refund related
\u00a0
to such activities
\u00a0
of NOK 110
\u00a0
million and
\u00a0
NOK 57 million,
\u00a0
respectively,
\u00a0
was received.
\u00a0
In 2022 and 2021, Telenor received NOK 274 and NOK
\u00a0
67 million in government grants,
\u00a0
respectively, in connection with construction of
\u00a0
broadband
networks
\u00a0
in designated
\u00a0
areas in
\u00a0
Norway.
Telenor pays an annual fee to Norwegian
\u00a0
Communications Authority and an annual levy to MLGRD
\u00a0
for delivering electronic communication
services,
\u00a0
including
\u00a0
payments
\u00a0
for frequencies
\u00a0
and numbers.
\u00a0
The fee/levy
\u00a0
was NOK 185
\u00a0
million and
\u00a0
NOK 189 million
\u00a0
in 2022
\u00a0
and 2021,
\u00a0
respectively.
Telenor invested NOK 1.2 billion in spectrum in
\u00a0
the 2.6 GHz and 3.6 GHz frequency
\u00a0
bands in Norway in 2021. The allocation in the
\u00a0
3.6 GHz band
became usable from 1 January 2022, while
\u00a0
the 2.6 GHz band allocation could be
\u00a0
used from 1 January 2023. Expiry of
\u00a0
both licenses are
\u00a0
31 December
2042.
In addition,
\u00a0
Telenor
\u00a0
sold transmission
\u00a0
capacity
\u00a0
and related
\u00a0
services
\u00a0
in the digital
\u00a0
and analogue
\u00a0
terrestrial
\u00a0
transmission
\u00a0
network to
\u00a0
Norsk
rikskringkasting
\u00a0
AS of NOK
\u00a0
226 million
\u00a0
in 2022
\u00a0
and NOK 210
\u00a0
million in
\u00a0
2021.
Telenor provides mobile and fixed telephony services, leased
\u00a0
lines, customer equipment, internet connections, TV distributions
\u00a0
and other services
to the state
\u00a0
and companies
\u00a0
controlled
\u00a0
by the state
\u00a0
in the normal
\u00a0
course of
\u00a0
business
\u00a0
and at arms-length
\u00a0
prices.
\u00a0
It also purchases
\u00a0
services,
\u00a0
such as
postal services,
\u00a0
in the normal
\u00a0
course of
\u00a0
business and
\u00a0
at arm\u2019s-length
\u00a0
prices.
\u00a0
Details of
\u00a0
such transactions
\u00a0
are not included
\u00a0
in this note.
\u00a0
Transactions
\u00a0
with associated
\u00a0
companies and
\u00a0
joint ventures
2022
2021
NOK in millions
Sales to
Sales to
483
(791)
499
(696)
Amounts receivable
\u00a0
from and amounts
\u00a0
due to associated
\u00a0
companies and
\u00a0
joint ventures
2022
2021
NOK in millions
Receivables
Payables
Receivables
Payables
210
(41)
88
(38)
Sales to associated companies in 2022 and 2021
\u00a0
include NOK 420 million and NOK 432
\u00a0
million in sale of satellite capacity to Allente
\u00a0
Group.
Purchases
\u00a0
from Strex
\u00a0
AS regarding
\u00a0
mobile content
\u00a0
services
\u00a0
were NOK
\u00a0
578 million
\u00a0
in 2022
\u00a0
and NOK 542
\u00a0
million in
\u00a0
2021.
CelcomDigi was accounted for as an associate
\u00a0
company from December 2022 upon the completion
\u00a0
of the merger between Digi and Celcom.
Telenor has
\u00a0
a receivable
\u00a0
against CelcomDigi
\u00a0
of NOK 131
\u00a0
million of
\u00a0
which NOK
\u00a0
72 million
\u00a0
are related
\u00a0
to integration
\u00a0
costs from
\u00a0
2021 and
\u00a0
2022.
Transactions with subsidiaries and joint operations have
\u00a0
been eliminated on consolidation and do not
\u00a0
represent related party transactions. See
note 35 for further information about joint
\u00a0
operations and note 34 further information about
\u00a0
group
\u00a0
companies.
\u00a0
For compensation
\u00a0
to key management
\u00a0
personnel,
\u00a0
please refer
\u00a0
to note 37
\u00a0
Key management
\u00a0
compensation
\u00a0
and chapter
\u00a0
11 and 12
\u00a0
in the corporate
governance
\u00a0
section of
\u00a0
the Board
\u00a0
of Directors\u2019
\u00a0
report.
NOTE 38
Fees to external auditor
The table
\u00a0
below summarises
\u00a0
incurred
\u00a0
audit fees
\u00a0
for 2022
\u00a0
and 2021
\u00a0
and fees
\u00a0
for audit
\u00a0
related services,
\u00a0
tax services
\u00a0
and other
\u00a0
services.
\u00a0
Fees include
both Norwegian and foreign subsidiaries.
Audit fees
Fees for further
\u00a0
assurance
services
Fees for tax
\u00a0
services
Other fees
NOK in millions,
\u00a0
excluding VAT
2022
2021
2022
2021
2022
2021
2022
2021
7.0
6.1
0.7
0.3
0.6
0.6
0.1
2.0
Other Group
\u00a0
companies
32.7
32.3
5.6
4.7
23.0
14.7
8.6
8.8
Total Group auditors
39.7
38.3
6.3
5.0
23.7
15.3
8.7
10.8
Other auditors in subsidiaries
0.5
0.9
0.0
0.0
0.0
0.0
0.0
0.0
Total
40.2
39.2
6.4
5.0
23.7
15.3
8.7
10.8
Fees for audit services include fees associated
\u00a0
with the required statutory and financial audits.
\u00a0
Further assurance services principally include other
attestation services required by laws and regulations, attestations
\u00a0
related to information system, audits, attestations and
\u00a0
agreed upon procedures
reported on to regulators and other third
\u00a0
parties.
\u00a0
Fees for
\u00a0
tax services
\u00a0
include
\u00a0
tax compliance
\u00a0
and advice
\u00a0
regarding
\u00a0
tax rules
\u00a0
and consequences,
\u00a0
as well as
\u00a0
tax due
\u00a0
diligence
\u00a0
services in
\u00a0
connection
with acquisitions, disposals, and other transactions. Other
\u00a0
fees relate primarily to process/system/project/supplier reviews, financial
\u00a0
due diligence
services
\u00a0
and consultations
\u00a0
in connection
\u00a0
with acquisitions,
\u00a0
disposals,
\u00a0
and other
\u00a0
transactions.
NOTE 39
Share information and ownership
Share information
As of 31 December 2022, Telenor ASA had a
\u00a0
share capital of NOK 8 396 748
\u00a0
198 divided into 1 399 458 033 ordinary
\u00a0
shares with a nominal value of
NOK 6 each. All ordinary Telenor shares have
\u00a0
equal voting rights and the right to
\u00a0
receive dividends. As of 31 December 2022 and 2021
\u00a0
the company
held no treasury shares.
Shareholders
As of 31 December 2022, Telenor ASA had about 61,300
\u00a0
registered shareholders, compared to about 57,100 as
\u00a0
of 31 December 2021.
\u00a0
The 20 largest shareholders as of 31 December 2022
\u00a0
from the shareholder register
1)
Name of shareholders
%
1
Ministry of Trade, Industry and Fisheries, Kingdom
\u00a0
of Norway
\u00a0
755 220 420
53.97
2
Folketrygdfondet
62 579 157
4.47
3
DNB Asset
\u00a0
Management
\u00a0
AS
29 014 798
2.07
4
26 948 952
1.93
5
BlackRock
\u00a0
Institutional
\u00a0
Trust Company,
\u00a0
N.A.
24 298 544
1.74
6
The Vanguard
\u00a0
Group, Inc.
22 474 455
1.61
7
Caisse de Depot et Placement du Quebec
18 634 411
1.33
8
Storebrand Kapitalforvaltning AS
18 235 048
1.30
9
Amundi Asset
\u00a0
Management,
\u00a0
SAS
14 369 399
1.03
10
KLP Fondsforvaltning AS
13 076 230
0.93
11
BlackRock Advisors (UK) Limited
10 777 743
0.77
12
Pyrford International Limited
10 424 701
0.74
13
State Street
\u00a0
Global Advisors
\u00a0
(US)
9 100 156
0.65
14
Handelsbanken Kapitalf\u00f6rvaltning AB
8 534 582
0.61
15
Danske Invest Asset Management AS
8 481 555
0.61
16
Danske Bank Asset Management
7 009 921
0.50
17
6 723 481
0.48
18
Fidelity
\u00a0
International
6 509 442
0.47
19
Legal & General Investment Management Ltd.
6 264 538
0.45
20
APG Asset
\u00a0
Management
\u00a0
N.V.
6 138 212
0.44
Total held by 20 largest shareholders
76.10
Total all Telenor shares
100.00
The 20 largest shareholders as of 31 December 2022
\u00a0
beneficial ownership
2)
Name of shareholders
%
1
Ministry of Trade, Industry and Fisheries, Kingdom
\u00a0
of Norway
\u00a0
755 220 420
53.97
2
FOLKETRYGDFONDET
62 579 157
4.47
3
State Street
\u00a0
Bank and
\u00a0
Trust Comp
28 908 338
2.07
4
State Street
\u00a0
Bank and
\u00a0
Trust Comp
27 135 763
1.94
5
State Street
\u00a0
Bank and
\u00a0
Trust Comp
24 842 271
1.78
6
12 730 679
0.91
7
State Street
\u00a0
Bank and
\u00a0
Trust Comp
12 679 695
0.91
8
State Street
\u00a0
Bank and
\u00a0
Trust Comp
12 147 338
0.87
9
CLEARSTREAM
\u00a0
BANKING S.A.
10 568 174
0.76
10
9 718 372
0.69
11
State Street
\u00a0
Bank and
\u00a0
Trust Comp
7 496 236
0.54
12
State Street
\u00a0
Bank and
\u00a0
Trust Comp
7 435 292
0.53
13
CACEIS Bank
7 028 900
0.50
14
VERDIPAPIRFONDET KLP AKSJENORGE IN
6 572 343
0.47
15
VERDIPAPIRFONDET DNB TEKNOLOGI
6 216 179
0.44
16
VERDIPAPIRFONDET STOREBRAND NORGE
6 093 235
0.44
17
VPF DNB
\u00a0
AM NORSKE
\u00a0
AKSJER
5 827 471
0.42
18
SIX SIS AG
5 620 721
0.40
19
The Bank of New York Mellon
5 287 074
0.38
20
Soci\u00e9t\u00e9 G\u00e9n\u00e9rale
5 037 420
0.36
Total held by 20 largest shareholders
72.85
Total all Telenor shares
100.00
1)
Source: VPS share register
2)
The data is provided by Nasdaq Advisory Services
\u00a0
and is obtained through an analysis of beneficial
\u00a0
ownership and fund manager information provided
\u00a0
in
replies to disclosure of ownership notices issued to
\u00a0
all custodians on the Telenor VPS share register.
\u00a0
Every reasonable effort has been made to verify
\u00a0
the data;
however, neither Telenor nor Nasdaq Advisory Services
\u00a0
can guarantee the accuracy of the analysis.
NOTE 40
Events after the reporting period
Completion of
\u00a0
the amalgamation
\u00a0
of dtac and True
\u00a0
in Thailand
On 1 March 2023, Telenor announced the completion
\u00a0
of the amalgamation of the telco operations
\u00a0
of True and dtac in Thailand. The transaction
\u00a0
is
the largest telco merger in Southeast Asia by
\u00a0
combined enterprise value. The name of the
\u00a0
new company is True Corporation. Telenor\u2019s ownership
in True Corporation after the transaction is
\u00a0
30.3%. The gain from the divestment of dtac
\u00a0
will be reported in Q1 2023. True Corporation will
\u00a0
be
accounted for as an associate using the
\u00a0
equity method going forward. The share of
\u00a0
profits or losses from True Corporation will
\u00a0
be included in the
Asia segment from Q1 2023.
Partial divestment
\u00a0
of Telenor Fiber
\u00a0
AS (Norway)
On 1 February
\u00a0
2023, Telenor
\u00a0
announced
\u00a0
the closing
\u00a0
of the transaction
\u00a0
to divest
\u00a0
30 percent
\u00a0
of the newly
\u00a0
established
\u00a0
company, Telenor
Fiber AS, in Norway to a consortium
\u00a0
led by KKR. The agreed sales price represents
\u00a0
an enterprise value for the Norwegian fiber
\u00a0
business
of NOK 36.1
\u00a0
billion, resulting
\u00a0
in proceeds
\u00a0
of NOK 10.8
\u00a0
billion to
\u00a0
Telenor.
\u00a0
The transaction
\u00a0
results in
\u00a0
an increase
\u00a0
of equity
\u00a0
to shareholders
\u00a0
of
Telenor
\u00a0
ASA of around
\u00a0
NOK 7.6
\u00a0
billion.
Partial settlement
\u00a0
with the Indian
\u00a0
Department of Telecommunications
On 30 January
\u00a0
2023, Telenor
\u00a0
paid NOK 1.5
\u00a0
billion
\u00a0
to the Department
\u00a0
of Telecommunications
\u00a0
in India
\u00a0
related to
\u00a0
warranties
\u00a0
given to
\u00a0
Bharti
Airtel for the period Telenor had operations in
\u00a0
India. The payment is a partial settlement of the
\u00a0
dispute related to the basis for calculating
license payments and spectrum usage charges. The payment
\u00a0
made will reduce the provision recognised in
\u00a0
the statement of financial
position accordingly.
\u00a0
See note
\u00a0
23 Legal
\u00a0
disputes
\u00a0
and note
\u00a0
12 Held
\u00a0
for sale and
\u00a0
discontinued
\u00a0
operations.
Dividend proposed
\u00a0
or declared by
\u00a0
the Board of
\u00a0
Directors in
\u00a0
subsidiaries with
\u00a0
non-controlling
\u00a0
interests
Dtac - Thailand
On 26 January
\u00a0
2023, the
\u00a0
Board of Directors
\u00a0
of dtac proposed
\u00a0
final dividend
\u00a0
for 2022
\u00a0
of THB 1.22
\u00a0
per share,
\u00a0
which corresponds
\u00a0
to
approximately NOK 0.8 billion total dividend and
\u00a0
approximately NOK 0.3 billion for the non-controlling
\u00a0
interests ownership share.
Grameenphone - Bangladesh
On 30 January 2023, the Board of Directors
\u00a0
of Grameenphone Ltd. proposed final dividend for
\u00a0
2022 of BDT 9.5 per share, which
corresponds to approximately NOK 1.2 billion total
\u00a0
dividend and approximately NOK 0.5 billion for the
\u00a0
non-controlling interests
NOTE 32
Fair values of financial instruments
Based on the characteristics of the financial instruments that are recognised
\u00a0
in the financial statements, the
financial instruments are grouped into classes and categories.
\u00a0
The estimated fair values of Telenor\u2019s financial
instruments are based on available market prices and various
\u00a0
valuation methodologies as summarised in this note.
\u00a0
Fair value
\u00a0
hierarchy
Telenor
\u00a0
measures fair
\u00a0
values using
\u00a0
the following
\u00a0
fair value
\u00a0
hierarchy
\u00a0
that reflects
\u00a0
the significance
\u00a0
of the inputs
\u00a0
used in measuring
\u00a0
fair value:
Level 1
:
\u00a0
Quoted prices
\u00a0
(unadjusted)
\u00a0
in active
\u00a0
markets for
\u00a0
identical
\u00a0
financial
\u00a0
instruments
Level 2:
\u00a0
Inputs other than quoted prices included within
\u00a0
Level 1 that are observable for assets or
\u00a0
liabilities, either directly (i.e. as prices) or
indirectly (i.e. derived from prices).
\u00a0
Level 3:
\u00a0
Inputs for assets or liabilities that are
\u00a0
not based on observable market data (unobservable
\u00a0
inputs).
Interest-bearing liabilities
Fair values of interest-bearing
\u00a0
liabilities as shown in note 30 are
\u00a0
based on quoted prices where available. Interest-bearing
\u00a0
liabilities that are not
traded in an active market have been
\u00a0
estimated using yield curves which incorporate estimates of
\u00a0
the Telenor ASA credit spread. The credit curves
have been extrapolated using indicative prices on debt
\u00a0
issuance by Telenor ASA for different maturities. The
\u00a0
yield curves have been interpolated
from cash and swap curves observed in
\u00a0
the market for different currencies
\u00a0
and maturities.
\u00a0
Trade receivables and other current and non-current financial assets
For trade receivables and other current receivables,
\u00a0
see note 19 for more information, the
\u00a0
carrying amount is assessed to be a
\u00a0
reasonable
approximation of fair value. The effect of not
\u00a0
discounting is considered to be immaterial for
\u00a0
this class of financial instruments.
\u00a0
Trade payables and other non-interest-bearing
\u00a0
financial liabilities
For trade
\u00a0
payables
\u00a0
and other
\u00a0
non-interest-bearing
\u00a0
financial
\u00a0
liabilities,
\u00a0
see note
\u00a0
24 for more
\u00a0
information,
\u00a0
the carrying
\u00a0
amount is
\u00a0
assessed
\u00a0
to be a
reasonable approximation of fair value. The effect of
\u00a0
not discounting is considered to be insignificant for
\u00a0
this class of financial instruments.
\u00a0
Equity investments
Fair values
\u00a0
for listed
\u00a0
shares as
\u00a0
shown in
\u00a0
note 27 are
\u00a0
based on quoted
\u00a0
prices at
\u00a0
the end of
\u00a0
the reporting
\u00a0
period. Fair
\u00a0
value of
\u00a0
unlisted shares
\u00a0
is
estimated by using commonly used valuation techniques
\u00a0
or measured at cost if the investment
\u00a0
does not have a quoted market price
\u00a0
in an active
market and the fair value cannot be
\u00a0
reliably measured.
\u00a0
Cash and cash equivalents
The fair
\u00a0
value for
\u00a0
this class
\u00a0
of financial
\u00a0
instruments
\u00a0
is assessed
\u00a0
to be equal
\u00a0
to the nominal
\u00a0
amount.
\u00a0
Fair value
\u00a0
of currency
\u00a0
swaps, foreign
\u00a0
currency
\u00a0
forward contracts
\u00a0
and interest
\u00a0
rate swaps
\u00a0
as shown in
\u00a0
note 27 is
\u00a0
estimated
\u00a0
based on calculating
\u00a0
the
net present
\u00a0
value of
\u00a0
future cash
\u00a0
flows, using
\u00a0
interest rate
\u00a0
curves, exchange
\u00a0
rates and
\u00a0
currency
\u00a0
spreads as
\u00a0
of 31 December
\u00a0
2022 and
\u00a0
2021,
respectively.
NOTE 1
Company information and basis of preparation
\u00a0
Telenor
\u00a0
is
\u00a0
a
\u00a0
Norwegian
\u00a0
listed
\u00a0
company
\u00a0
offering
telecommunications services
\u00a0
in
\u00a0
the
\u00a0
Nordics
\u00a0
and
\u00a0
Asia.
The
\u00a0
consolidated
\u00a0
financial
\u00a0
statements
\u00a0
of
\u00a0
Telenor
\u00a0
are
prepared according to IFRS. The accounting policies
\u00a0
are
described in
\u00a0
this note
\u00a0
and in
\u00a0
the individual
\u00a0
notes to
\u00a0
the
financial statements.
Company information
The consolidated financial statements of Telenor (referred
\u00a0
to as \u201cthe
company\u201d)
\u00a0
comprise the parent company and its subsidiaries.
\u00a0
The
parent company
Telenor ASA
public limited company
listed on the Oslo Stock exchange under
\u00a0
the ticker TEL.
\u00a0
The principal
activities
\u00a0
of Telenor
\u00a0
are described
\u00a0
in note 2
\u00a0
Segments.
\u00a0
The headquarter
is at
Snar\u00f8yveien 30, N-1360 Fornebu, Norway
number is +47 810 77 000.
Basis of preparation
The consolidated financial statements are prepared in accordance with
International Financial Reporting Standards (IFRS) as adopted by
\u00a0
the
European Union (EU) and the additional requirements
\u00a0
of the Norwegian
Accounting Act.
\u00a0
The consolidated financial statements were approved
by the Board of Directors on 21
\u00a0
March 2023 and is subject to approval by
the Annual General Meeting on 10 May 2023.
The consolidated financial statements have been prepared
\u00a0
on a
historical cost basis, except for equity investments
\u00a0
(primarily
shareholdings of less than 20%) and derivative
\u00a0
financial instruments,
which are
\u00a0
carried at
\u00a0
fair value.
\u00a0
The financial
\u00a0
year corresponds
\u00a0
to the
calendar year. The consolidated financial statements are
\u00a0
presented in
Norwegian Kroner (NOK). Amounts are rounded to
\u00a0
the nearest million,
unless otherwise
\u00a0
stated. As
\u00a0
a result
\u00a0
of rounding
\u00a0
adjustments,
\u00a0
amounts
and percentages
\u00a0
may not add
\u00a0
up to the
\u00a0
total.
The merger of Digi with Celcom was
\u00a0
completed in November 2022,
resulting
\u00a0
in Digi being
\u00a0
deconsolidated
\u00a0
from the
\u00a0
Telenor
\u00a0
group and
\u00a0
the
remaining 33.1% ownership being recognised as an associate. The
transaction resulted in a gain for Telenor
\u00a0
of NOK 32.7 billion. Historical
figures
\u00a0
have been
\u00a0
represented
\u00a0
as discontinued
\u00a0
operations,
\u00a0
refer to
further information
\u00a0
in note
\u00a0
12.
Accounting policies
Descriptions
\u00a0
of accounting principles are generally included in the
various notes to the financial statements. The general principles
\u00a0
relating
to foreign
\u00a0
currency
\u00a0
translation,
\u00a0
distinction
\u00a0
between
\u00a0
current
\u00a0
and non-
current assets and liabilities and government grants
\u00a0
are described
below.
Foreign currency
\u00a0
translation
\u00a0
The consolidated financial statements are presented in
\u00a0
NOK, which is
Telenor ASA\u2019s functional currency. The group has foreign
\u00a0
entities with
functional
\u00a0
currency
\u00a0
other than
\u00a0
NOK. At
\u00a0
the reporting
\u00a0
date, the
\u00a0
assets
and liabilities of foreign entities with functional
\u00a0
currencies other than
NOK are translated
\u00a0
into NOK at
\u00a0
the rate
\u00a0
of exchange
\u00a0
at the reporting
date. The income statements are translated at the
\u00a0
average exchange
rates for
\u00a0
the year
\u00a0
except significant
\u00a0
transactions
\u00a0
that are
\u00a0
translated
using the daily exchange rate. The translation
\u00a0
differences arising from
the translation are recognised in other comprehensive
\u00a0
income until the
disposal of the net investment, at
\u00a0
which time they are recognised in the
income statement.
Current/non-current
\u00a0
classification
An asset or liability is classified as current
\u00a0
when it is expected to be
realised, sold, used or settled in Telenor\u2019s
\u00a0
normal operating cycle, which
is normally
\u00a0
within twelve
\u00a0
months after
\u00a0
the reporting
\u00a0
date. Other
\u00a0
assets
and liabilities are classified as non-current.
\u00a0
Financial instruments, other
than those held for trading, are classified
\u00a0
based on maturity, and
hedging instruments are classified consistently with the underlying
hedged item.
Government grants are recognised when there is
\u00a0
reasonable assurance
that the grant
\u00a0
will be
\u00a0
received.
\u00a0
Grants that
\u00a0
relate to
\u00a0
expenses
\u00a0
are
normally recognised as a reduction of the
\u00a0
expense over the related
period.
\u00a0
Grants that relate to assets
\u00a0
are deducted from the carrying
amount of the asset and result in
\u00a0
lower depreciation over the useful life
of the asset.
Key judgments
\u00a0
and estimates
The preparation of consolidated financial statements of Telenor
involves significant
\u00a0
judgements
\u00a0
and estimates
\u00a0
that could
\u00a0
result in
material adjustments to the carrying amount of
\u00a0
the asset or liability the
next financial year. Management is required to make
\u00a0
difficult, subjective
and complex
\u00a0
assessments
\u00a0
of the outcome
\u00a0
of matters
\u00a0
that are
inherently uncertain on an ongoing basis. The key
\u00a0
judgments and
estimates
\u00a0
are based
\u00a0
on historical
\u00a0
results and
\u00a0
experience,
\u00a0
consultations
with experts,
\u00a0
trends, forecasts
\u00a0
and scenarios
\u00a0
of future
\u00a0
development
and other methods which management considers reasonable
\u00a0
under the
circumstances.
\u00a0
Information about key judgments and estimates are
included in the individual notes. The following notes
\u00a0
include the most
significant judgments and estimates in the consolidated
\u00a0
financial
statements
\u00a0
of Telenor:
\u25cf
Note 10 Income
\u00a0
taxes
\u25cf
Note 14 Goodwill
\u25cf
Note 16 Right-of-use
\u00a0
assets
\u25cf
Note 17 Property,
\u00a0
plant and
\u00a0
equipment
\u25cf
Note 18 Impairment
\u00a0
of assets
\u25cf
Note 22 Provisions
\u00a0
and obligations
\u25cf
Note 23 Legal disputes and contingencies
Adoption of
\u00a0
new and revised
\u00a0
standards, amendments
and interpretations
The accounting policies applied are consistent with
\u00a0
those applied in the
previous financial year, except for the implementation
\u00a0
of new and
revised accounting standards as described below. The
\u00a0
amendments
adopted with effect from 1 January 2022 relevant
\u00a0
for Telenor include:
\u00a0
\u25cf
Onerous contracts - cost of fulfilling a
\u00a0
contract (amendments to IAS
37
Provisions,
\u00a0
Contingent
\u00a0
Liabilities
\u00a0
and Contingent
\u00a0
Assets:
Onerous Contracts
\u00a0
- Cost of
\u00a0
Fulfilling
\u00a0
a Contract)
scope amendments
\u00a0
clarify
\u00a0
that the cost
\u00a0
of fulfilling
\u00a0
an onerous
contract includes
\u00a0
both incremental
\u00a0
cost and
\u00a0
an allocation
\u00a0
of other
costs that
\u00a0
relate directly
\u00a0
to fulfilling
\u00a0
the contract.
\u00a0
The
implementation
\u00a0
did not have
\u00a0
a significant
\u00a0
impact on
\u00a0
Telenor\u2019s
consolidated financial statements.
Telenor
\u00a0
has not early
\u00a0
adopted
\u00a0
any standard,
\u00a0
interpretation
\u00a0
or
amendment
\u00a0
that has been
\u00a0
issued but
\u00a0
is not yet
\u00a0
effective.
\u00a0
The
amendments are effective from 1 January 2023 are
\u00a0
not expected to
have a significant
\u00a0
impact on
\u00a0
the consolidated
\u00a0
financial
\u00a0
statements.
Basis of preparation
The consolidated financial statements are prepared in accordance with
International Financial Reporting Standards (IFRS) as adopted by
\u00a0
the
European Union (EU) and the additional requirements
\u00a0
of the Norwegian
Accounting Act.
\u00a0
The consolidated financial statements were approved
by the Board of Directors on 21
\u00a0
March 2023 and is subject to approval by
the Annual General Meeting on 10 May 2023.
The consolidated financial statements are prepared in accordance with
International Financial Reporting Standards (IFRS) as adopted by
\u00a0
the
European Union (EU) and the additional requirements
\u00a0
of the Norwegian
Accounting Act.
\u00a0
The consolidated financial statements were approved
by the Board of Directors on 21
\u00a0
March 2023 and is subject to approval by
the Annual General Meeting on 10 May 2023.
Foreign currency
\u00a0
translation
\u00a0
The consolidated financial statements are presented in
\u00a0
NOK, which is
Telenor ASA\u2019s functional currency. The group has foreign
\u00a0
entities with
functional
\u00a0
currency
\u00a0
other than
\u00a0
NOK. At
\u00a0
the reporting
\u00a0
date, the
\u00a0
assets
and liabilities of foreign entities with functional
\u00a0
currencies other than
NOK are translated
\u00a0
into NOK at
\u00a0
the rate
\u00a0
of exchange
\u00a0
at the reporting
date. The income statements are translated at the
\u00a0
average exchange
rates for
\u00a0
the year
\u00a0
except significant
\u00a0
transactions
\u00a0
that are
\u00a0
translated
using the daily exchange rate. The translation
\u00a0
differences arising from
the translation are recognised in other comprehensive
\u00a0
income until the
disposal of the net investment, at
\u00a0
which time they are recognised in the
income statement.
Foreign currency
\u00a0
translation
\u00a0
The consolidated financial statements are presented in
\u00a0
NOK, which is
Telenor ASA\u2019s functional currency. The group has foreign
\u00a0
entities with
functional
\u00a0
currency
\u00a0
other than
\u00a0
NOK. At
\u00a0
the reporting
\u00a0
date, the
\u00a0
assets
and liabilities of foreign entities with functional
\u00a0
currencies other than
NOK are translated
\u00a0
into NOK at
\u00a0
the rate
\u00a0
of exchange
\u00a0
at the reporting
date. The income statements are translated at the
\u00a0
average exchange
rates for
\u00a0
the year
\u00a0
except significant
\u00a0
transactions
\u00a0
that are
\u00a0
translated
using the daily exchange rate. The translation
\u00a0
differences arising from
the translation are recognised in other comprehensive
\u00a0
income until the
disposal of the net investment, at
\u00a0
which time they are recognised in the
income statement.
Current/non-current
\u00a0
classification
An asset or liability is classified as current
\u00a0
when it is expected to be
realised, sold, used or settled in Telenor\u2019s
\u00a0
normal operating cycle, which
is normally
\u00a0
within twelve
\u00a0
months after
\u00a0
the reporting
\u00a0
date. Other
\u00a0
assets
and liabilities are classified as non-current.
\u00a0
Financial instruments, other
than those held for trading, are classified
\u00a0
based on maturity, and
hedging instruments are classified consistently with the underlying
hedged item.
Government grants are recognised when there is
\u00a0
reasonable assurance
that the grant
\u00a0
will be
\u00a0
received.
\u00a0
Grants that
\u00a0
relate to
\u00a0
expenses
\u00a0
are
normally recognised as a reduction of the
\u00a0
expense over the related
period.
\u00a0
Grants that relate to assets
\u00a0
are deducted from the carrying
amount of the asset and result in
\u00a0
lower depreciation over the useful life
of the asset.
Adoption of
\u00a0
new and revised
\u00a0
standards, amendments
and interpretations
The accounting policies applied are consistent with
\u00a0
those applied in the
previous financial year, except for the implementation
\u00a0
of new and
revised accounting standards as described below. The
\u00a0
amendments
adopted with effect from 1 January 2022 relevant
\u00a0
for Telenor include:
\u00a0
\u25cf
Onerous contracts - cost of fulfilling a
\u00a0
contract (amendments to IAS
37
Provisions,
\u00a0
Contingent
\u00a0
Liabilities
\u00a0
and Contingent
\u00a0
Assets:
Onerous Contracts
\u00a0
- Cost of
\u00a0
Fulfilling
\u00a0
a Contract)
scope amendments
\u00a0
clarify
\u00a0
that the cost
\u00a0
of fulfilling
\u00a0
an onerous
contract includes
\u00a0
both incremental
\u00a0
cost and
\u00a0
an allocation
\u00a0
of other
costs that
\u00a0
relate directly
\u00a0
to fulfilling
\u00a0
the contract.
\u00a0
The
implementation
\u00a0
did not have
\u00a0
a significant
\u00a0
impact on
\u00a0
Telenor\u2019s
consolidated financial statements.
Telenor
\u00a0
has not early
\u00a0
adopted
\u00a0
any standard,
\u00a0
interpretation
\u00a0
or
amendment
\u00a0
that has been
\u00a0
issued but
\u00a0
is not yet
\u00a0
effective.
\u00a0
The
amendments are effective from 1 January 2023 are
\u00a0
not expected to
have a significant
\u00a0
impact on
\u00a0
the consolidated
\u00a0
financial
\u00a0
statements.
NOTE 2
Segments
The segments are consistent with the countries where Telenor
\u00a0
operates within mobile and fixed line
communication. Telenor had seven operating segments
\u00a0
at year-end 2022, of which four were in the Nordics and
three in Asia. Digi in Malaysia merged with Celcom in November 2022
\u00a0
and is no longer a segment of Telenor, but an
associated company.
\u00a0
Accounting policies
Reporting segments are identified based on reporting
\u00a0
to Group Management Team (chief operating decision makers)
\u00a0
and is consistent with
financial information used for assessing performance and allocating
\u00a0
resources during 2022 and 2021. The accounting principles
\u00a0
for the segment
reporting
\u00a0
are consistent
\u00a0
with those
\u00a0
applied by
\u00a0
the Group.
\u00a0
The operating
\u00a0
and reportable
\u00a0
segments
\u00a0
are based
\u00a0
on business
\u00a0
activities
\u00a0
and
geographical
\u00a0
location.
\u00a0
The segment
\u00a0
result
\u00a0
is defined
\u00a0
as EBITDA
\u00a0
before other
\u00a0
income and
\u00a0
other expenses.
Deliveries of network-based regulated services are based
\u00a0
on cost-oriented prices based on
\u00a0
negotiations between the units. All transactions
between the segments are based on market conditions. Gains
\u00a0
and losses arising from internal transfer of
\u00a0
businesses, group contribution and
dividends
\u00a0
within the
\u00a0
Group are
\u00a0
not included
\u00a0
in the income
\u00a0
statements
\u00a0
for the segments.
Segments
The countries
\u00a0
where Telenor
\u00a0
operates
\u00a0
is the basis
\u00a0
for the segment
\u00a0
reporting.
\u00a0
The mobile
\u00a0
communication
\u00a0
business mainly
\u00a0
includes
\u00a0
voice, data,
internet, content services, customer equipment and messaging.
\u00a0
In Norway, Sweden, Denmark and Finland, the
\u00a0
fixed line businesses are reported
together with mobile operations. Fixed services comprise
\u00a0
telephony, internet and TV and leased lines, as well
\u00a0
as data services and managed
services.
Other units consist of Corporate Functions, Telenor
\u00a0
Infra, Telenor Satellite and Other Businesses. Corporate Functions
\u00a0
comprise activities such as
global shared services, research and development, strategic
\u00a0
Group projects, Group Treasury, the internal insurance
\u00a0
company, and support
functions. Telenor Infra operates all tower infrastructure
\u00a0
in Norway previously operated by Telenor Norway,
\u00a0
Norkring and Telenor Real Estate.
Telenor
\u00a0
Satellite
\u00a0
offers broadcasting
\u00a0
and data
\u00a0
communication
\u00a0
services
\u00a0
via satellite.
\u00a0
Other Businesses
\u00a0
consists mainly
\u00a0
of mobile
\u00a0
communication
business at sea conducted by Telenor Maritime;
\u00a0
Telenor Linx, which is focused on interconnecting global
\u00a0
operators and delivering key
communications services on a global scale; Telenor Real
\u00a0
Estate; Telenor Connexion, which is specialising in Internet
\u00a0
of Things with capabilities to
support the most advanced machine-to-machine-communication
\u00a0
and Internet of Things customers worldwide;
\u00a0
and other businesses, including
internet
\u00a0
based services,
\u00a0
none of which
\u00a0
are material
\u00a0
enough to
\u00a0
be reported
\u00a0
as separate
\u00a0
segments.
\u00a0
Change in composition
\u00a0
of reportable
\u00a0
segments
In 2022,
\u00a0
Telenor announced
\u00a0
the new
\u00a0
organisation
\u00a0
to take effect
\u00a0
from 2023.
\u00a0
As a consequence,
\u00a0
the current
\u00a0
country-based
\u00a0
segment reporting
\u00a0
will be
discontinued and replaced with the following four
\u00a0
operating segments
\u00a0
from the first quarter 2023: Nordics, Asia,
\u00a0
Infrastructure and Amp. The
mobile and fixed line businesses will be reported
\u00a0
in the Nordic and Asia segments.
\u00a0
The Infrastructure segment will consists of certain
\u00a0
passive
infrastructure
\u00a0
in the Nordics,
\u00a0
whereas
\u00a0
the Amp segment
\u00a0
will consist
\u00a0
of the portfolio
\u00a0
of adjacent
\u00a0
business and
\u00a0
companies
\u00a0
that are
\u00a0
near the
\u00a0
core of
Telenor\u2019s
\u00a0
business.
\u00a0
Pursuant to closing of the merger between
\u00a0
Digi and Celcom in Malaysia on 30
\u00a0
November 2022, Digi as a subsidiary is classified
\u00a0
as discontinued
operations with comparative figures re-presented. Telenor\u2019s ownership
\u00a0
in the merged entity CelcomDigi is recognised as
\u00a0
associated company
using the equity method,
\u00a0
see note 35. The share of profits
\u00a0
or losses from CelcomDigi will be included in the Asia
\u00a0
segment from Q1 2023.
\u00a0
Segment Information
\u00a0
2022
NOK in millions
Revenues
External revenues
EBITDA before
other
expenses
1)
EBITDA
1)
Depreciation,
(loss)
Investments
2)
Capital employed
3)
Norway
25 400
24 959
12 236
11 853
(7 146)
4 707
6 849
28 033
Sweden
11 712
11 620
4 033
5 729
(2 525)
3 204
2 016
14 720
Denmark
5 510
5 414
1 396
1 375
( 910)
465
934
5 013
DNA - Finland
10 074
10 031
3 681
3 678
(2 614)
1 064
1 387
33 665
dtac - Thailand
22 107
22 076
8 181
8 020
(6 155)
1 865
3 168
37 823
Grameenphone -
Bangladesh
15 508
15 392
9 685
9 441
(2 870)
6 571
3 701
9 086
Pakistan
5 188
4 822
2 891
2 888
(3 917)
(1 028)
2 188
7 586
Other units
9 061
4 639
2 409
2 299
(1 292)
1 007
2 042
n.m.
Eliminations
(5 606)
-
(2 139)
(2 166)
1 658
( 509)
-
n.m.
Group
98 953
98 953
42 374
43 117
(25 770)
17 346
22 284
n.m.
Segment Information
\u00a0
2021
NOK in millions
Revenues
External revenues
EBITDA before
other expenses
1)
EBITDA
1)
Depreciation,
(loss)
Investments
2)
Capital employed
3)
Norway
25 362
24 915
12 758
11 726
(6 739)
4 987
5 637
25 378
Sweden
12 107
12 038
4 434
4 428
(2 651)
1 777
1 839
16 242
Denmark
5 346
5 259
1 413
1 362
( 927)
434
1 077
4 621
DNA - Finland
9 712
9 678
3 645
3 643
(2 651)
993
1 625
33 951
dtac - Thailand
21 878
21 826
8 067
7 934
(6 050)
1 884
3 852
39 701
Grameenphone -
Bangladesh
14 464
14 362
9 052
8 730
(2 327)
6 403
2 853
7 976
Pakistan
5 604
5 328
2 976
2 967
(1 751)
1 216
3 129
8 886
Other units
7 518
3 747
1 508
1 323
(1 231)
92
1 027
n.m.
Eliminations
(4 838)
-
(1 196)
(1 212)
1 080
( 132)
-
n.m.
Group
97 153
97 153
42 656
40 902
(23 247)
17 654
21 038
n.m.
1)
See table below for definition and reconciliation of EBITDA.
\u00a0
2)
Investments consist of capex and investments in businesses.
\u00a0
See page 180 for alternative performance measures.
\u00a0
3)
Capital employed (average for the period) adjusted
\u00a0
for dividend and group contribution payables/receivables.
For definition of capital employed and Group
figures, see page 180 for alternative performance measures.
\u00a0
(n.m. \u2013 not measured)
Reconciliation
NOK in millions
2022
2021
EBITDA before
\u00a0
other income
\u00a0
and other expenses
42 374
42 656
Other income
2 004
172
Other expenses
(1 261)
(1 926)
EBITDA
43 117
40 902
Geographical
\u00a0
distribution of
\u00a0
external revenues
\u00a0
based on customer
\u00a0
location
NOK in millions
2022
2021
Norway
25 826
25 730
Sweden
12 806
12 810
Denmark
5 563
5 423
Finland
9 940
9 528
Thailand
22 086
21 866
Bangladesh
15 390
14 360
Pakistan
4 829
5 343
Other countries
2 513
2 094
Total revenues
98 953
97 153
Assets by geographical
\u00a0
location of the
\u00a0
company
Non-current
\u00a0
assets excluding
\u00a0
deferred tax
assets,
\u00a0
contract cost
\u00a0
and other
\u00a0
non-current
Total assets
NOK in millions
2022
2021
2022
2021
Norway
35 559
34 503
54 233
56 423
Sweden
16 120
17 349
23 191
22 803
Denmark
4 448
3 921
7 703
7 723
Finland
34 868
33 985
40 692
38 522
Thailand
37 814
37 973
47 219
47 305
Malaysia
34 436
13 266
34 448
17 333
Bangladesh
14 071
12 958
17 576
16 648
Pakistan
7 837
10 536
10 287
12 784
Myanmar
-
349
-
2 543
Other countries
2 902
2 816
3 899
3 658
Total assets
188 055
167 657
239 249
225 740
Accounting policies
Reporting segments are identified based on reporting
\u00a0
to Group Management Team (chief operating decision makers)
\u00a0
and is consistent with
financial information used for assessing performance and allocating
\u00a0
resources during 2022 and 2021. The accounting principles
\u00a0
for the segment
reporting
\u00a0
are consistent
\u00a0
with those
\u00a0
applied by
\u00a0
the Group.
\u00a0
The operating
\u00a0
and reportable
\u00a0
segments
\u00a0
are based
\u00a0
on business
\u00a0
activities
\u00a0
and
geographical
\u00a0
location.
\u00a0
The segment
\u00a0
result
\u00a0
is defined
\u00a0
as EBITDA
\u00a0
before other
\u00a0
income and
\u00a0
other expenses.
Deliveries of network-based regulated services are based
\u00a0
on cost-oriented prices based on
\u00a0
negotiations between the units. All transactions
between the segments are based on market conditions. Gains
\u00a0
and losses arising from internal transfer of
\u00a0
businesses, group contribution and
dividends
\u00a0
within the
\u00a0
Group are
\u00a0
not included
\u00a0
in the income
\u00a0
statements
\u00a0
for the segments.
NOTE 3
Revenues
Revenues in Telenor mainly relate to mobile and fixed operations.
\u00a0
Revenues in mobile operations include
subscription fees in addition to roaming,
\u00a0
traffic fees and interconnect fees for use of Telenor\u2019s
\u00a0
network. Devices
like mobile phones are regularly part of a bundled offering together
\u00a0
with the subscription. Revenues in the fixed
operations include services like telephony, broadband,
\u00a0
TV connections, broadcasting, data networks and
\u00a0
data
security services.
Accounting policies
Services
Service revenues
\u00a0
include
\u00a0
subscriptions
\u00a0
and traffic
\u00a0
revenues for
\u00a0
mobile
\u00a0
voice and
\u00a0
data. Subscriptions
\u00a0
are either
\u00a0
invoiced
\u00a0
on a monthly
\u00a0
basis or
prepaid.
\u00a0
Outbound roaming
\u00a0
charges in
\u00a0
addition
\u00a0
to voice
\u00a0
and non-voice
\u00a0
traffic
\u00a0
fees are
\u00a0
recognised
\u00a0
based on the
\u00a0
minutes or
\u00a0
data used.
\u00a0
Other mobile
services include subscriptions and services for machine-to-machine
\u00a0
and internet-of-things (IoT), inbound and national roaming
\u00a0
and revenues
related to service providers and MVNOs (Mobile
\u00a0
Virtual Network Operators). Interconnect fees are revenues
\u00a0
from other operators
\u00a0
using Telenor\u2019s
networks. Service revenues are recognised
\u00a0
over time or based on usage.
Fixed-network
\u00a0
services include revenues from telephony, internet,
\u00a0
TV, broadcasting and data services.
\u00a0
The subscription fees are usually flat rate,
where some contracts have a minimum contract
\u00a0
term. Fixed service revenues are recognised
\u00a0
over time or based on usage.
\u00a0
Goods
Revenues from the sale of mobile phones, broadband
\u00a0
set-up boxes and other devices are
\u00a0
recognised at point in time when the equipment
\u00a0
is
delivered
\u00a0
to the customer.
Bundled multi-element contracts
Bundled multi-element contracts
\u00a0
are contracts that consist of several
\u00a0
separate identifiable performance obligations. Within mobile operations this
typically include a subscription, a handset and sometimes
\u00a0
screen insurance and other services. Within our
\u00a0
fixed operations this typically include
subscription, set-up boxes and other
\u00a0
types of equipment or services.
\u00a0
The transaction
\u00a0
price is
\u00a0
net of discounts
\u00a0
and sales
\u00a0
related
\u00a0
taxes. Bundled
\u00a0
contracts
\u00a0
may include
\u00a0
a financing
\u00a0
component,
\u00a0
as the handset
\u00a0
or other
equipment is provided to a customer up-front
\u00a0
and payments
\u00a0
are received over an instalment period. Financing components
\u00a0
are not considered
when the
\u00a0
timing of
\u00a0
the payment
\u00a0
is at the
\u00a0
discretion
\u00a0
of the customer
\u00a0
(for example
\u00a0
prepaid mobile
\u00a0
services)
\u00a0
or the timing
\u00a0
difference
\u00a0
between
rendering
\u00a0
the service
\u00a0
or good and
\u00a0
payment is
\u00a0
less than
\u00a0
twelve months.
\u00a0
If a significant
\u00a0
financing
\u00a0
component is
\u00a0
provided
\u00a0
to the customer,
\u00a0
the
transaction price is adjusted, and interest revenue
\u00a0
is recognised over the customer\u2019s payment period
\u00a0
using an interest rate reflecting the relevant
risk-free
\u00a0
rate and
\u00a0
customer specific
\u00a0
credit risk.
The transaction price for bundled contracts is allocated
\u00a0
to each identified performance obligation based on
\u00a0
relative prices Telenor would achieve
by selling the same
\u00a0
goods or services to a similar customer
\u00a0
on a stand-alone basis.
\u00a0
Discounts are allocated proportionately to all performance
obligations
\u00a0
in the contract
\u00a0
unless there
\u00a0
is observable
\u00a0
evidence
\u00a0
to allocate
\u00a0
it differently.
\u00a0
Mobile swap contracts
\u00a0
The Group
\u00a0
offers in
\u00a0
some markets
\u00a0
sale of
\u00a0
handsets on
\u00a0
instalment
\u00a0
plans with
\u00a0
an option
\u00a0
for the customer
\u00a0
to change
\u00a0
to a new
\u00a0
device before
\u00a0
all the
instalments
\u00a0
are paid.
\u00a0
If the option
\u00a0
is exercised,
\u00a0
the customer
\u00a0
pays any
\u00a0
remaining
\u00a0
months of
\u00a0
minimum
\u00a0
instalment
\u00a0
under the
\u00a0
original
\u00a0
contract and
enters into
\u00a0
a new contract.
\u00a0
The transaction
\u00a0
price at
\u00a0
inception
\u00a0
of the contract
\u00a0
includes
\u00a0
an estimate
\u00a0
of the payments
\u00a0
to be received
\u00a0
based on the
expected value approach using historical data. When the
\u00a0
Group is obliged to accept return of
\u00a0
the original handset, a refund liability is recognised
\u00a0
at
the inception
\u00a0
of the contract.
\u00a0
A returned-good
\u00a0
asset with
\u00a0
a corresponding
\u00a0
adjustment
\u00a0
to cost
\u00a0
of sales
\u00a0
is recognised
\u00a0
representing
\u00a0
the right
\u00a0
to
recover the returned handsets. The new device
\u00a0
is accounted for as a new, separate contract.
\u00a0
Telenor as
\u00a0
agent
\u00a0
In some markets,
\u00a0
mobile subscriptions
\u00a0
and devices
\u00a0
are sold
\u00a0
as bundles
\u00a0
through external
\u00a0
channels.
\u00a0
The group
\u00a0
acts as principal
\u00a0
for the subscription
services
\u00a0
and recognise
\u00a0
the revenues
\u00a0
on a gross
\u00a0
basis. For
\u00a0
the sale
\u00a0
of the handset
\u00a0
an assessment
\u00a0
is made
\u00a0
to determine
\u00a0
if Telenor
\u00a0
is agent
\u00a0
or
principal. If Telenor is regarded as an agent, no revenue
\u00a0
is recognised as there are no commissions
\u00a0
earned for providing services in the capacity of
an agent in these arrangements.
\u00a0
Further, Telenor is acting as an agent
\u00a0
in arrangements where third parties are the main
\u00a0
supplier and the Group
mainly arrange for those goods or services
\u00a0
to be provided by the third party.
\u00a0
For example, screen insurance which is offered
\u00a0
as part of a bundled
offering
\u00a0
in some mobile
\u00a0
subscriptions.
\u00a0
Other revenues
Revenues other than mobile and fixed operations
\u00a0
are mainly offered by units not separately
\u00a0
identified as reporting segments. Revenues include
colocation services, data centre facilities, telemetrics (communication
\u00a0
between machines), satellite services, maritime services and
\u00a0
Internet of
Things (IoT).
\u00a0
Revenues are
\u00a0
recognised
\u00a0
over time
\u00a0
based on
\u00a0
either monthly
\u00a0
fees or usage.
\u00a0
Lease revenues
\u00a0
(IFRS 16)
The Group
\u00a0
has operating
\u00a0
lease arrangements
\u00a0
in which
\u00a0
it is a lessor,
\u00a0
mainly related
\u00a0
to passive
\u00a0
infrastructure
\u00a0
sharing with
\u00a0
other telecommunication
operators. The Group has classified these leases
\u00a0
as operating leases because they do not
\u00a0
transfer substantially all the risks and rewards incidental
to ownership
\u00a0
of the underlying
\u00a0
assets. Lease
\u00a0
revenues are
\u00a0
recognised
\u00a0
on a straight-line
\u00a0
basis over
\u00a0
the lease
\u00a0
term.
Key judgments
\u00a0
and estimates
In mobile
\u00a0
swap contracts,
\u00a0
there is
\u00a0
an uncertainty
\u00a0
when and
\u00a0
if the customer
\u00a0
will exercise
\u00a0
the option
\u00a0
to cancel
\u00a0
the current
\u00a0
contract and
\u00a0
enter into
\u00a0
a
new. As the transaction price at inception
\u00a0
of the contract is based on an
\u00a0
estimate of payments received,
\u00a0
the revenue is a variable consideration.
The total consideration to be received is
\u00a0
estimated based on the expected value approach using
\u00a0
historical data.
\u00a0
In some markets
\u00a0
with mobile
\u00a0
swap contracts,
\u00a0
Telenor
\u00a0
is obliged
\u00a0
to accept
\u00a0
return of
\u00a0
the original
\u00a0
handset and
\u00a0
a refund
\u00a0
liability
\u00a0
is recognised.
\u00a0
In other
markets, an external third party takes ownership
\u00a0
of the device, resells it and guarantee a
\u00a0
compensation to Telenor. In these contracts, Telenor
consider
\u00a0
the guaranteed
\u00a0
amount from
\u00a0
the third
\u00a0
party as
\u00a0
part of the
\u00a0
total consideration
\u00a0
to be received
\u00a0
at inception
\u00a0
of the contract.
Disaggregation
\u00a0
of revenues
\u00a0
from contract
\u00a0
with customers
Revenues
\u00a0
are disaggregated
\u00a0
by major revenue
\u00a0
streams divided
\u00a0
into the reportable
\u00a0
segments
\u00a0
as shown
\u00a0
in note 2
\u00a0
in the table
\u00a0
below.
Year 2022
NOK in millions
Norway
Sweden
Denmark
Finland
dtac
Thailand
Grameenphone
Bangladesh
Pakistan
units
Eliminations
Group
Type of good/ services
Mobile operation
15 955
8 341
4 952
7 761
18 559
15 323
5 047
-
(1 062)
74 875
Services
13 832
6 619
3 744
6 025
16 094
15 301
5 037
-
(1 059)
65 593
Goods
2 123
1 722
1 208
1 735
2 464
22
10
-
( 2)
9 282
Fixed operation
8 529
3 126
529
2 169
-
-
-
2 170
( 642)
15 880
Services
8 180
3 119
529
2 169
-
-
-
2 170
( 587)
15 578
Goods
349
7
-
-
-
-
-
-
( 54)
302
Other
587
-
-
-
-
-
-
4 117
(1 699)
3 004
Services
587
-
-
-
-
-
-
4 109
(1 699)
2 997
Goods
-
-
-
-
-
-
-
8
-
8
Sum type of
goods/services
25 071
11 468
5 480
9 930
18 559
15 323
5 047
6 287
(3 403)
93 760
Type of mobile subscription
Contract
11 697
5 637
3 212
5 498
10 174
708
244
-
( 123)
37 047
Prepaid
104
193
-
229
5 230
14 553
4 729
-
( 449)
24 589
Other
1)
2 032
789
532
298
691
39
64
-
( 488)
3 956
Sum services in
Mobile operation
13 832
6 619
3 744
6 025
16 094
15 301
5 037
-
(1 059)
65 593
Timing of
\u00a0
revenue recognition
Over time
22 599
9 738
4 273
8 194
16 094
15 301
5 037
6 278
(3 346)
84 168
2 472
1 730
1 208
1 735
2 464
22
10
8
( 57)
9 592
Total revenue from
contract with
customers
25 071
11 468
5 480
9 930
18 559
15 323
5 047
6 287
(3 403)
93 760
Other revenue
2)
329
244
30
144
3 548
185
141
2 775
(2 203)
5 193
Total revenue
25 400
11 712
5 510
10 074
22 107
15 508
5 188
9 061
(5 606)
98 953
Segment revenue as
presented in note 2
25 400
11 712
5 510
10 074
22 107
15 508
5 188
9 061
(5 606)
98 953
1)
Other includes revenues from other mobile and non-mobile
\u00a0
services, refer to definitions on page 180.
2)
Other revenue includes mainly lease revenue.
Year 2021
NOK in millions
Norway
Sweden
Denmark
Finland
dtac
Thailand
Grameenphone
Bangladesh
Pakistan
units
Eliminations
Group
Type of good/ services
Mobile operation
15 350
8 268
4 814
7 496
18 502
14 288
5 461
-
( 962)
73 218
Services
13 362
6 541
3 617
5 951
16 133
14 263
5 451
-
( 961)
64 357
Goods
1 987
1 728
1 197
1 546
2 370
25
10
-
( 1)
8 862
Fixed operation
9 058
3 623
502
2 185
-
-
-
1 732
( 561)
16 540
Services
8 690
3 616
502
2 185
-
-
-
1 732
( 512)
16 214
Goods
369
7
-
-
-
-
-
-
( 50)
326
Other
639
-
-
-
-
-
-
3 903
(1 855)
2 687
Services
639
-
-
-
-
-
-
3 889
(1 855)
2 673
Goods
-
-
-
-
-
-
-
14
-
14
Sum type of
goods/services
25 047
11 892
5 316
9 682
18 502
14 288
5 461
5 635
(3 378)
92 445
Type of
\u00a0
mobile subscription
Contract
11 525
5 723
3 199
5 396
10 286
629
162
-
( 72)
36 849
Prepaid
122
177
-
209
5 190
13 591
5 224
-
( 516)
23 998
Other
1)
1 715
640
419
345
656
44
65
-
( 374)
3 510
Sum services in
Mobile operation
13 362
6 541
3 617
5 951
16 133
14 263
5 451
-
( 961)
64 357
Timing of
\u00a0
revenue recognition
Over time
22 691
10 157
4 119
8 136
16 133
14 263
5 451
5 621
(3 328)
83 244
2 356
1 735
1 197
1 546
2 370
25
10
14
( 50)
9 202
Total revenue from
contract with
customers
25 047
11 892
5 316
9 682
18 502
14 288
5 461
5 635
(3 378)
92 445
Other revenue
2)
314
216
30
31
3 376
176
143
1 883
(1 461)
4 708
Total revenue
25 362
12 107
5 346
9 712
21 878
14 464
5 604
7 518
(4 838)
97 153
Segment revenue as
presented in note 2
25 362
12 107
5 346
9 712
21 878
14 464
5 604
7 518
(4 838)
97 153
1)
Other includes revenues from other mobile and non-mobile
\u00a0
services, refer to definitions on page 180.
2)
Other revenue includes mainly lease revenue.
Lease revenues
Other revenue of NOK 5.2 billion (NOK
\u00a0
4.7 billion in 2021) recognised in the
\u00a0
income statement includes variable lease revenue of NOK 152 million
(NOK 87 million
\u00a0
in 2021)
\u00a0
primarily
\u00a0
relating
\u00a0
to energy
\u00a0
charges received
\u00a0
from lessees
\u00a0
based on
\u00a0
the consumption.
The following table sets forth the maturity
\u00a0
analysis of minimum lease payments to be
\u00a0
received in nominal terms after the reporting date:
NOK in millions
2022
2021
5 209
4 919
1 to 2 years
4 653
4 478
2 to 3 years
3 246
4 438
3 to 4 years
493
2 658
4 to 5 years
487
400
After 5 years
831
504
Total
14 919
17 397
NOTE 3
Revenues
Revenues in Telenor mainly relate to mobile and fixed operations.
\u00a0
Revenues in mobile operations include
subscription fees in addition to roaming,
\u00a0
traffic fees and interconnect fees for use of Telenor\u2019s
\u00a0
network. Devices
like mobile phones are regularly part of a bundled offering together
\u00a0
with the subscription. Revenues in the fixed
operations include services like telephony, broadband,
\u00a0
TV connections, broadcasting, data networks and
\u00a0
data
security services.
Accounting policies
Services
Service revenues
\u00a0
include
\u00a0
subscriptions
\u00a0
and traffic
\u00a0
revenues for
\u00a0
mobile
\u00a0
voice and
\u00a0
data. Subscriptions
\u00a0
are either
\u00a0
invoiced
\u00a0
on a monthly
\u00a0
basis or
prepaid.
\u00a0
Outbound roaming
\u00a0
charges in
\u00a0
addition
\u00a0
to voice
\u00a0
and non-voice
\u00a0
traffic
\u00a0
fees are
\u00a0
recognised
\u00a0
based on the
\u00a0
minutes or
\u00a0
data used.
\u00a0
Other mobile
services include subscriptions and services for machine-to-machine
\u00a0
and internet-of-things (IoT), inbound and national roaming
\u00a0
and revenues
related to service providers and MVNOs (Mobile
\u00a0
Virtual Network Operators). Interconnect fees are revenues
\u00a0
from other operators
\u00a0
using Telenor\u2019s
networks. Service revenues are recognised
\u00a0
over time or based on usage.
Fixed-network
\u00a0
services include revenues from telephony, internet,
\u00a0
TV, broadcasting and data services.
\u00a0
The subscription fees are usually flat rate,
where some contracts have a minimum contract
\u00a0
term. Fixed service revenues are recognised
\u00a0
over time or based on usage.
\u00a0
Goods
Revenues from the sale of mobile phones, broadband
\u00a0
set-up boxes and other devices are
\u00a0
recognised at point in time when the equipment
\u00a0
is
delivered
\u00a0
to the customer.
Bundled multi-element contracts
Bundled multi-element contracts
\u00a0
are contracts that consist of several
\u00a0
separate identifiable performance obligations. Within mobile operations this
typically include a subscription, a handset and sometimes
\u00a0
screen insurance and other services. Within our
\u00a0
fixed operations this typically include
subscription, set-up boxes and other
\u00a0
types of equipment or services.
\u00a0
The transaction
\u00a0
price is
\u00a0
net of discounts
\u00a0
and sales
\u00a0
related
\u00a0
taxes. Bundled
\u00a0
contracts
\u00a0
may include
\u00a0
a financing
\u00a0
component,
\u00a0
as the handset
\u00a0
or other
equipment is provided to a customer up-front
\u00a0
and payments
\u00a0
are received over an instalment period. Financing components
\u00a0
are not considered
when the
\u00a0
timing of
\u00a0
the payment
\u00a0
is at the
\u00a0
discretion
\u00a0
of the customer
\u00a0
(for example
\u00a0
prepaid mobile
\u00a0
services)
\u00a0
or the timing
\u00a0
difference
\u00a0
between
rendering
\u00a0
the service
\u00a0
or good and
\u00a0
payment is
\u00a0
less than
\u00a0
twelve months.
\u00a0
If a significant
\u00a0
financing
\u00a0
component is
\u00a0
provided
\u00a0
to the customer,
\u00a0
the
transaction price is adjusted, and interest revenue
\u00a0
is recognised over the customer\u2019s payment period
\u00a0
using an interest rate reflecting the relevant
risk-free
\u00a0
rate and
\u00a0
customer specific
\u00a0
credit risk.
The transaction price for bundled contracts is allocated
\u00a0
to each identified performance obligation based on
\u00a0
relative prices Telenor would achieve
by selling the same
\u00a0
goods or services to a similar customer
\u00a0
on a stand-alone basis.
\u00a0
Discounts are allocated proportionately to all performance
obligations
\u00a0
in the contract
\u00a0
unless there
\u00a0
is observable
\u00a0
evidence
\u00a0
to allocate
\u00a0
it differently.
\u00a0
Mobile swap contracts
\u00a0
The Group
\u00a0
offers in
\u00a0
some markets
\u00a0
sale of
\u00a0
handsets on
\u00a0
instalment
\u00a0
plans with
\u00a0
an option
\u00a0
for the customer
\u00a0
to change
\u00a0
to a new
\u00a0
device before
\u00a0
all the
instalments
\u00a0
are paid.
\u00a0
If the option
\u00a0
is exercised,
\u00a0
the customer
\u00a0
pays any
\u00a0
remaining
\u00a0
months of
\u00a0
minimum
\u00a0
instalment
\u00a0
under the
\u00a0
original
\u00a0
contract and
enters into
\u00a0
a new contract.
\u00a0
The transaction
\u00a0
price at
\u00a0
inception
\u00a0
of the contract
\u00a0
includes
\u00a0
an estimate
\u00a0
of the payments
\u00a0
to be received
\u00a0
based on the
expected value approach using historical data. When the
\u00a0
Group is obliged to accept return of
\u00a0
the original handset, a refund liability is recognised
\u00a0
at
the inception
\u00a0
of the contract.
\u00a0
A returned-good
\u00a0
asset with
\u00a0
a corresponding
\u00a0
adjustment
\u00a0
to cost
\u00a0
of sales
\u00a0
is recognised
\u00a0
representing
\u00a0
the right
\u00a0
to
recover the returned handsets. The new device
\u00a0
is accounted for as a new, separate contract.
\u00a0
Telenor as
\u00a0
agent
\u00a0
In some markets,
\u00a0
mobile subscriptions
\u00a0
and devices
\u00a0
are sold
\u00a0
as bundles
\u00a0
through external
\u00a0
channels.
\u00a0
The group
\u00a0
acts as principal
\u00a0
for the subscription
services
\u00a0
and recognise
\u00a0
the revenues
\u00a0
on a gross
\u00a0
basis. For
\u00a0
the sale
\u00a0
of the handset
\u00a0
an assessment
\u00a0
is made
\u00a0
to determine
\u00a0
if Telenor
\u00a0
is agent
\u00a0
or
principal. If Telenor is regarded as an agent, no revenue
\u00a0
is recognised as there are no commissions
\u00a0
earned for providing services in the capacity of
an agent in these arrangements.
\u00a0
Further, Telenor is acting as an agent
\u00a0
in arrangements where third parties are the main
\u00a0
supplier and the Group
mainly arrange for those goods or services
\u00a0
to be provided by the third party.
\u00a0
For example, screen insurance which is offered
\u00a0
as part of a bundled
offering
\u00a0
in some mobile
\u00a0
subscriptions.
\u00a0
Other revenues
Revenues other than mobile and fixed operations
\u00a0
are mainly offered by units not separately
\u00a0
identified as reporting segments. Revenues include
colocation services, data centre facilities, telemetrics (communication
\u00a0
between machines), satellite services, maritime services and
\u00a0
Internet of
Things (IoT).
\u00a0
Revenues are
\u00a0
recognised
\u00a0
over time
\u00a0
based on
\u00a0
either monthly
\u00a0
fees or usage.
\u00a0
Lease revenues
\u00a0
(IFRS 16)
The Group
\u00a0
has operating
\u00a0
lease arrangements
\u00a0
in which
\u00a0
it is a lessor,
\u00a0
mainly related
\u00a0
to passive
\u00a0
infrastructure
\u00a0
sharing with
\u00a0
other telecommunication
operators. The Group has classified these leases
\u00a0
as operating leases because they do not
\u00a0
transfer substantially all the risks and rewards incidental
to ownership
\u00a0
of the underlying
\u00a0
assets. Lease
\u00a0
revenues are
\u00a0
recognised
\u00a0
on a straight-line
\u00a0
basis over
\u00a0
the lease
\u00a0
term.
Key judgments
\u00a0
and estimates
In mobile
\u00a0
swap contracts,
\u00a0
there is
\u00a0
an uncertainty
\u00a0
when and
\u00a0
if the customer
\u00a0
will exercise
\u00a0
the option
\u00a0
to cancel
\u00a0
the current
\u00a0
contract and
\u00a0
enter into
\u00a0
a
new. As the transaction price at inception
\u00a0
of the contract is based on an
\u00a0
estimate of payments received,
\u00a0
the revenue is a variable consideration.
The total consideration to be received is
\u00a0
estimated based on the expected value approach using
\u00a0
historical data.
\u00a0
In some markets
\u00a0
with mobile
\u00a0
swap contracts,
\u00a0
Telenor
\u00a0
is obliged
\u00a0
to accept
\u00a0
return of
\u00a0
the original
\u00a0
handset and
\u00a0
a refund
\u00a0
liability
\u00a0
is recognised.
\u00a0
In other
markets, an external third party takes ownership
\u00a0
of the device, resells it and guarantee a
\u00a0
compensation to Telenor. In these contracts, Telenor
consider
\u00a0
the guaranteed
\u00a0
amount from
\u00a0
the third
\u00a0
party as
\u00a0
part of the
\u00a0
total consideration
\u00a0
to be received
\u00a0
at inception
\u00a0
of the contract.
Disaggregation
\u00a0
of revenues
\u00a0
from contract
\u00a0
with customers
Revenues
\u00a0
are disaggregated
\u00a0
by major revenue
\u00a0
streams divided
\u00a0
into the reportable
\u00a0
segments
\u00a0
as shown
\u00a0
in note 2
\u00a0
in the table
\u00a0
below.
Year 2022
NOK in millions
Norway
Sweden
Denmark
Finland
dtac
Thailand
Grameenphone
Bangladesh
Pakistan
units
Eliminations
Group
Type of good/ services
Mobile operation
15 955
8 341
4 952
7 761
18 559
15 323
5 047
-
(1 062)
74 875
Services
13 832
6 619
3 744
6 025
16 094
15 301
5 037
-
(1 059)
65 593
Goods
2 123
1 722
1 208
1 735
2 464
22
10
-
( 2)
9 282
Fixed operation
8 529
3 126
529
2 169
-
-
-
2 170
( 642)
15 880
Services
8 180
3 119
529
2 169
-
-
-
2 170
( 587)
15 578
Goods
349
7
-
-
-
-
-
-
( 54)
302
Other
587
-
-
-
-
-
-
4 117
(1 699)
3 004
Services
587
-
-
-
-
-
-
4 109
(1 699)
2 997
Goods
-
-
-
-
-
-
-
8
-
8
Sum type of
goods/services
25 071
11 468
5 480
9 930
18 559
15 323
5 047
6 287
(3 403)
93 760
Type of mobile subscription
Contract
11 697
5 637
3 212
5 498
10 174
708
244
-
( 123)
37 047
Prepaid
104
193
-
229
5 230
14 553
4 729
-
( 449)
24 589
Other
1)
2 032
789
532
298
691
39
64
-
( 488)
3 956
Sum services in
Mobile operation
13 832
6 619
3 744
6 025
16 094
15 301
5 037
-
(1 059)
65 593
Timing of
\u00a0
revenue recognition
Over time
22 599
9 738
4 273
8 194
16 094
15 301
5 037
6 278
(3 346)
84 168
2 472
1 730
1 208
1 735
2 464
22
10
8
( 57)
9 592
Total revenue from
contract with
customers
25 071
11 468
5 480
9 930
18 559
15 323
5 047
6 287
(3 403)
93 760
Other revenue
2)
329
244
30
144
3 548
185
141
2 775
(2 203)
5 193
Total revenue
25 400
11 712
5 510
10 074
22 107
15 508
5 188
9 061
(5 606)
98 953
Segment revenue as
presented in note 2
25 400
11 712
5 510
10 074
22 107
15 508
5 188
9 061
(5 606)
98 953
1)
Other includes revenues from other mobile and non-mobile
\u00a0
services, refer to definitions on page 180.
2)
Other revenue includes mainly lease revenue.
Year 2021
NOK in millions
Norway
Sweden
Denmark
Finland
dtac
Thailand
Grameenphone
Bangladesh
Pakistan
units
Eliminations
Group
Type of good/ services
Mobile operation
15 350
8 268
4 814
7 496
18 502
14 288
5 461
-
( 962)
73 218
Services
13 362
6 541
3 617
5 951
16 133
14 263
5 451
-
( 961)
64 357
Goods
1 987
1 728
1 197
1 546
2 370
25
10
-
( 1)
8 862
Fixed operation
9 058
3 623
502
2 185
-
-
-
1 732
( 561)
16 540
Services
8 690
3 616
502
2 185
-
-
-
1 732
( 512)
16 214
Goods
369
7
-
-
-
-
-
-
( 50)
326
Other
639
-
-
-
-
-
-
3 903
(1 855)
2 687
Services
639
-
-
-
-
-
-
3 889
(1 855)
2 673
Goods
-
-
-
-
-
-
-
14
-
14
Sum type of
goods/services
25 047
11 892
5 316
9 682
18 502
14 288
5 461
5 635
(3 378)
92 445
Type of
\u00a0
mobile subscription
Contract
11 525
5 723
3 199
5 396
10 286
629
162
-
( 72)
36 849
Prepaid
122
177
-
209
5 190
13 591
5 224
-
( 516)
23 998
Other
1)
1 715
640
419
345
656
44
65
-
( 374)
3 510
Sum services in
Mobile operation
13 362
6 541
3 617
5 951
16 133
14 263
5 451
-
( 961)
64 357
Timing of
\u00a0
revenue recognition
Over time
22 691
10 157
4 119
8 136
16 133
14 263
5 451
5 621
(3 328)
83 244
2 356
1 735
1 197
1 546
2 370
25
10
14
( 50)
9 202
Total revenue from
contract with
customers
25 047
11 892
5 316
9 682
18 502
14 288
5 461
5 635
(3 378)
92 445
Other revenue
2)
314
216
30
31
3 376
176
143
1 883
(1 461)
4 708
Total revenue
25 362
12 107
5 346
9 712
21 878
14 464
5 604
7 518
(4 838)
97 153
Segment revenue as
presented in note 2
25 362
12 107
5 346
9 712
21 878
14 464
5 604
7 518
(4 838)
97 153
1)
Other includes revenues from other mobile and non-mobile
\u00a0
services, refer to definitions on page 180.
2)
Other revenue includes mainly lease revenue.
Lease revenues
Other revenue of NOK 5.2 billion (NOK
\u00a0
4.7 billion in 2021) recognised in the
\u00a0
income statement includes variable lease revenue of NOK 152 million
(NOK 87 million
\u00a0
in 2021)
\u00a0
primarily
\u00a0
relating
\u00a0
to energy
\u00a0
charges received
\u00a0
from lessees
\u00a0
based on
\u00a0
the consumption.
The following table sets forth the maturity
\u00a0
analysis of minimum lease payments to be
\u00a0
received in nominal terms after the reporting date:
NOK in millions
2022
2021
5 209
4 919
1 to 2 years
4 653
4 478
2 to 3 years
3 246
4 438
3 to 4 years
493
2 658
4 to 5 years
487
400
After 5 years
831
504
Total
14 919
17 397
Accounting policies
Services
Service revenues
\u00a0
include
\u00a0
subscriptions
\u00a0
and traffic
\u00a0
revenues for
\u00a0
mobile
\u00a0
voice and
\u00a0
data. Subscriptions
\u00a0
are either
\u00a0
invoiced
\u00a0
on a monthly
\u00a0
basis or
prepaid.
\u00a0
Outbound roaming
\u00a0
charges in
\u00a0
addition
\u00a0
to voice
\u00a0
and non-voice
\u00a0
traffic
\u00a0
fees are
\u00a0
recognised
\u00a0
based on the
\u00a0
minutes or
\u00a0
data used.
\u00a0
Other mobile
services include subscriptions and services for machine-to-machine
\u00a0
and internet-of-things (IoT), inbound and national roaming
\u00a0
and revenues
related to service providers and MVNOs (Mobile
\u00a0
Virtual Network Operators). Interconnect fees are revenues
\u00a0
from other operators
\u00a0
using Telenor\u2019s
networks. Service revenues are recognised
\u00a0
over time or based on usage.
Fixed-network
\u00a0
services include revenues from telephony, internet,
\u00a0
TV, broadcasting and data services.
\u00a0
The subscription fees are usually flat rate,
where some contracts have a minimum contract
\u00a0
term. Fixed service revenues are recognised
\u00a0
over time or based on usage.
\u00a0
Goods
Revenues from the sale of mobile phones, broadband
\u00a0
set-up boxes and other devices are
\u00a0
recognised at point in time when the equipment
\u00a0
is
delivered
\u00a0
to the customer.
Bundled multi-element contracts
Bundled multi-element contracts
\u00a0
are contracts that consist of several
\u00a0
separate identifiable performance obligations. Within mobile operations this
typically include a subscription, a handset and sometimes
\u00a0
screen insurance and other services. Within our
\u00a0
fixed operations this typically include
subscription, set-up boxes and other
\u00a0
types of equipment or services.
\u00a0
The transaction
\u00a0
price is
\u00a0
net of discounts
\u00a0
and sales
\u00a0
related
\u00a0
taxes. Bundled
\u00a0
contracts
\u00a0
may include
\u00a0
a financing
\u00a0
component,
\u00a0
as the handset
\u00a0
or other
equipment is provided to a customer up-front
\u00a0
and payments
\u00a0
are received over an instalment period. Financing components
\u00a0
are not considered
when the
\u00a0
timing of
\u00a0
the payment
\u00a0
is at the
\u00a0
discretion
\u00a0
of the customer
\u00a0
(for example
\u00a0
prepaid mobile
\u00a0
services)
\u00a0
or the timing
\u00a0
difference
\u00a0
between
rendering
\u00a0
the service
\u00a0
or good and
\u00a0
payment is
\u00a0
less than
\u00a0
twelve months.
\u00a0
If a significant
\u00a0
financing
\u00a0
component is
\u00a0
provided
\u00a0
to the customer,
\u00a0
the
transaction price is adjusted, and interest revenue
\u00a0
is recognised over the customer\u2019s payment period
\u00a0
using an interest rate reflecting the relevant
risk-free
\u00a0
rate and
\u00a0
customer specific
\u00a0
credit risk.
The transaction price for bundled contracts is allocated
\u00a0
to each identified performance obligation based on
\u00a0
relative prices Telenor would achieve
by selling the same
\u00a0
goods or services to a similar customer
\u00a0
on a stand-alone basis.
\u00a0
Discounts are allocated proportionately to all performance
obligations
\u00a0
in the contract
\u00a0
unless there
\u00a0
is observable
\u00a0
evidence
\u00a0
to allocate
\u00a0
it differently.
\u00a0
Mobile swap contracts
\u00a0
The Group
\u00a0
offers in
\u00a0
some markets
\u00a0
sale of
\u00a0
handsets on
\u00a0
instalment
\u00a0
plans with
\u00a0
an option
\u00a0
for the customer
\u00a0
to change
\u00a0
to a new
\u00a0
device before
\u00a0
all the
instalments
\u00a0
are paid.
\u00a0
If the option
\u00a0
is exercised,
\u00a0
the customer
\u00a0
pays any
\u00a0
remaining
\u00a0
months of
\u00a0
minimum
\u00a0
instalment
\u00a0
under the
\u00a0
original
\u00a0
contract and
enters into
\u00a0
a new contract.
\u00a0
The transaction
\u00a0
price at
\u00a0
inception
\u00a0
of the contract
\u00a0
includes
\u00a0
an estimate
\u00a0
of the payments
\u00a0
to be received
\u00a0
based on the
expected value approach using historical data. When the
\u00a0
Group is obliged to accept return of
\u00a0
the original handset, a refund liability is recognised
\u00a0
at
the inception
\u00a0
of the contract.
\u00a0
A returned-good
\u00a0
asset with
\u00a0
a corresponding
\u00a0
adjustment
\u00a0
to cost
\u00a0
of sales
\u00a0
is recognised
\u00a0
representing
\u00a0
the right
\u00a0
to
recover the returned handsets. The new device
\u00a0
is accounted for as a new, separate contract.
\u00a0
Telenor as
\u00a0
agent
\u00a0
In some markets,
\u00a0
mobile subscriptions
\u00a0
and devices
\u00a0
are sold
\u00a0
as bundles
\u00a0
through external
\u00a0
channels.
\u00a0
The group
\u00a0
acts as principal
\u00a0
for the subscription
services
\u00a0
and recognise
\u00a0
the revenues
\u00a0
on a gross
\u00a0
basis. For
\u00a0
the sale
\u00a0
of the handset
\u00a0
an assessment
\u00a0
is made
\u00a0
to determine
\u00a0
if Telenor
\u00a0
is agent
\u00a0
or
principal. If Telenor is regarded as an agent, no revenue
\u00a0
is recognised as there are no commissions
\u00a0
earned for providing services in the capacity of
an agent in these arrangements.
\u00a0
Further, Telenor is acting as an agent
\u00a0
in arrangements where third parties are the main
\u00a0
supplier and the Group
mainly arrange for those goods or services
\u00a0
to be provided by the third party.
\u00a0
For example, screen insurance which is offered
\u00a0
as part of a bundled
offering
\u00a0
in some mobile
\u00a0
subscriptions.
\u00a0
Other revenues
Revenues other than mobile and fixed operations
\u00a0
are mainly offered by units not separately
\u00a0
identified as reporting segments. Revenues include
colocation services, data centre facilities, telemetrics (communication
\u00a0
between machines), satellite services, maritime services and
\u00a0
Internet of
Things (IoT).
\u00a0
Revenues are
\u00a0
recognised
\u00a0
over time
\u00a0
based on
\u00a0
either monthly
\u00a0
fees or usage.
\u00a0
Lease revenues
\u00a0
(IFRS 16)
The Group
\u00a0
has operating
\u00a0
lease arrangements
\u00a0
in which
\u00a0
it is a lessor,
\u00a0
mainly related
\u00a0
to passive
\u00a0
infrastructure
\u00a0
sharing with
\u00a0
other telecommunication
operators. The Group has classified these leases
\u00a0
as operating leases because they do not
\u00a0
transfer substantially all the risks and rewards incidental
to ownership
\u00a0
of the underlying
\u00a0
assets. Lease
\u00a0
revenues are
\u00a0
recognised
\u00a0
on a straight-line
\u00a0
basis over
\u00a0
the lease
\u00a0
term.
Accounting policies
Reporting segments are identified based on reporting
\u00a0
to Group Management Team (chief operating decision makers)
\u00a0
and is consistent with
financial information used for assessing performance and allocating
\u00a0
resources during 2022 and 2021. The accounting principles
\u00a0
for the segment
reporting
\u00a0
are consistent
\u00a0
with those
\u00a0
applied by
\u00a0
the Group.
\u00a0
The operating
\u00a0
and reportable
\u00a0
segments
\u00a0
are based
\u00a0
on business
\u00a0
activities
\u00a0
and
geographical
\u00a0
location.
\u00a0
The segment
\u00a0
result
\u00a0
is defined
\u00a0
as EBITDA
\u00a0
before other
\u00a0
income and
\u00a0
other expenses.
Deliveries of network-based regulated services are based
\u00a0
on cost-oriented prices based on
\u00a0
negotiations between the units. All transactions
between the segments are based on market conditions. Gains
\u00a0
and losses arising from internal transfer of
\u00a0
businesses, group contribution and
dividends
\u00a0
within the
\u00a0
Group are
\u00a0
not included
\u00a0
in the income
\u00a0
statements
\u00a0
for the segments.
Share-based payment program
Employees
\u00a0
and managers
\u00a0
worldwide
\u00a0
are offered
\u00a0
to purchase
\u00a0
Telenor shares
\u00a0
at a discounted
\u00a0
price and
\u00a0
potentially
\u00a0
earn bonus
\u00a0
shares if
\u00a0
the share
price exceeds certain benchmarks in the future.
\u00a0
Bonus shares are awarded net after tax
\u00a0
and Telenor withhold and pay withholding taxes on behalf
of the employee. The share-based payment programs including
\u00a0
the withholding tax are considered as equity-settled share-based
\u00a0
payments, where
the fair
\u00a0
value of
\u00a0
the bonus
\u00a0
shares is
\u00a0
estimated
\u00a0
at the grant
\u00a0
date and
\u00a0
expensed
\u00a0
over the
\u00a0
vesting period.
\u00a0
Social security
\u00a0
taxes are
\u00a0
recognised
\u00a0
as
cash-settled share-based payments measured at fair value
\u00a0
and remeasured at each reporting date.
Accounting policies
Development expenditures
\u00a0
are capitalised only when the criteria for
\u00a0
recognition are met, i.e. that it is probable
\u00a0
that the expected future economic
benefits that are attributable to the asset
\u00a0
will flow to the entity, management has
\u00a0
committed itself to complete the asset, the
\u00a0
technical feasibility of
completing the asset has been demonstrated and
\u00a0
the cost can be measured reliably. The assets
\u00a0
are amortised over their expected useful life
\u00a0
once
the assets
\u00a0
are available
\u00a0
for use.
\u00a0
Costs incurred
\u00a0
during the
\u00a0
research
\u00a0
stage of
\u00a0
a project,
\u00a0
as well
\u00a0
as maintenance
\u00a0
and training
\u00a0
costs are
\u00a0
expensed
\u00a0
as
incurred.
\u00a0
Development
\u00a0
costs that
\u00a0
do not meet
\u00a0
the criteria
\u00a0
for capitalisation
\u00a0
are expensed
\u00a0
as incurred.
Interest expenses related
\u00a0
to bonds,
\u00a0
commercial papers, bank loans and bank overdrafts are
\u00a0
recognised at amortised
\u00a0
cost using the effective
interest-rate method.
\u00a0
Foreign currency gains and losses arise from
\u00a0
monetary assets and liabilities denominated in foreign
\u00a0
currencies translated to
the functional currency. All exchange differences are
\u00a0
recognised in the income statement except exchange differences
\u00a0
on foreign currency
borrowings and monetary items that provide an
\u00a0
effective hedge against a net investment in
\u00a0
a foreign entity.
\u00a0
These gains and losses are recognised
in other comprehensive income until the disposal
\u00a0
of the net investment or settlement of
\u00a0
the monetary item, at which time they
\u00a0
are recognised in
the income statement. Dividend income from investments is
\u00a0
recognised when the Group\u2019s rights to receive
\u00a0
payment have been established
(declared by the General Meeting or otherwise) and
\u00a0
classified as financial income.
Accounting policies
Telenor bases its assessment of taxable income
\u00a0
on interpretation of relevant laws and regulations,
\u00a0
and when it is considered as probable that the
tax treatment
\u00a0
will be
\u00a0
sustained
\u00a0
in a tax
\u00a0
review. Current
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are measured
\u00a0
at the amount
\u00a0
expected
\u00a0
to be recovered
\u00a0
or paid
\u00a0
to
the tax authorities.
\u00a0
Deferred
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are calculated
\u00a0
using the
\u00a0
liability
\u00a0
method where
\u00a0
deferred
\u00a0
taxes are
\u00a0
recognised
\u00a0
on the
difference between the tax base and the
\u00a0
carrying amount of the assets and liabilities,
\u00a0
including tax losses carried forward. Deferred tax assets and
liabilities
\u00a0
are not recognised
\u00a0
on goodwill
\u00a0
or on investments
\u00a0
in subsidiaries,
\u00a0
associates,
\u00a0
or joint
\u00a0
ventures
\u00a0
where the
\u00a0
timing of
\u00a0
the reversal
\u00a0
can be
controlled,
\u00a0
and it is
\u00a0
probable
\u00a0
that the temporary
\u00a0
difference
\u00a0
will not be
\u00a0
reversed
\u00a0
in the foreseeable
\u00a0
future. Deferred
\u00a0
tax assets
\u00a0
are only
\u00a0
recognised
\u00a0
to
the extent
\u00a0
it is more
\u00a0
likely than
\u00a0
not that the
\u00a0
tax assets
\u00a0
will be
\u00a0
utilised.
\u00a0
Deferred
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are offset
\u00a0
when there
\u00a0
is a legally
\u00a0
enforceable
right, Telenor
\u00a0
is capable
\u00a0
to and intends
\u00a0
to settle
\u00a0
on a net
\u00a0
basis. The
\u00a0
enacted tax
\u00a0
rates at
\u00a0
the end of
\u00a0
the reporting
\u00a0
period and
\u00a0
undiscounted
\u00a0
amounts
are used. A change in deferred tax assets
\u00a0
and liabilities because of change in tax rates
\u00a0
is recognised in profit or loss, except when
\u00a0
it relates to items
that previously was recognised in other comprehensive income
\u00a0
or directly in equity. Deferred tax is provided for
\u00a0
undistributed earnings in
subsidiaries when distribution is expected in foreseeable future.
\u00a0
Deferred tax for undistributed earnings in associated
\u00a0
companies is provided for as
the timing
\u00a0
of the reversal
\u00a0
of the temporary
\u00a0
differences
\u00a0
cannot be
\u00a0
controlled
\u00a0
by Telenor.
Accounting policies
Earnings per share (EPS) is the amount of
\u00a0
profit generated for the financial year attributable
\u00a0
to equity shareholders divided by the weighted
average ordinary outstanding shares.
Accounting policies
\u00a0
Non-current
\u00a0
assets and
\u00a0
disposal
\u00a0
groups are
\u00a0
classified
\u00a0
as held for
\u00a0
sale if their
\u00a0
carrying
\u00a0
amounts will
\u00a0
be recovered
\u00a0
principally
\u00a0
through sale
\u00a0
rather than
continuing
\u00a0
use. This
\u00a0
also applies
\u00a0
for situations
\u00a0
where the
\u00a0
Group continues
\u00a0
its operations
\u00a0
but loses
\u00a0
control over
\u00a0
the operation.
\u00a0
Non-current
\u00a0
assets
and disposal
\u00a0
groups classified
\u00a0
as held for
\u00a0
sale are
\u00a0
measured
\u00a0
at the lower
\u00a0
of their
\u00a0
carrying
\u00a0
amount and
\u00a0
fair value
\u00a0
less cost
\u00a0
to sell and
\u00a0
presented
separately
\u00a0
as assets
\u00a0
held for
\u00a0
sale and
\u00a0
liabilities
\u00a0
held for
\u00a0
sale in the
\u00a0
statement
\u00a0
of financial
\u00a0
position.
The criteria
\u00a0
for held
\u00a0
for sale classification
\u00a0
is regarded
\u00a0
as met only
\u00a0
when the sale
\u00a0
is highly
\u00a0
probable,
\u00a0
and the asset
\u00a0
or disposal
\u00a0
group is
\u00a0
available
\u00a0
for
immediate sale in its present condition. Actions required
\u00a0
to complete the sale should indicate that
\u00a0
it is unlikely that significant changes to the plan
will be
\u00a0
made or
\u00a0
that the plan
\u00a0
to sell will
\u00a0
be withdrawn.
\u00a0
In addition,
\u00a0
management
\u00a0
must be committed
\u00a0
to the plan,
\u00a0
and must
\u00a0
be expected
\u00a0
that the sale
will be completed within a year.
Property,
\u00a0
plant and
\u00a0
equipment
\u00a0
and intangible
\u00a0
assets are
\u00a0
not depreciated
\u00a0
or amortised
\u00a0
once classified
\u00a0
as held
\u00a0
for sale.
\u00a0
The equity
\u00a0
method is
discontinued
\u00a0
for associated
\u00a0
companies
\u00a0
classified
\u00a0
as held for
\u00a0
sale.
A disposal group qualifies as discontinued operation if
\u00a0
it is a cash generating unit that
\u00a0
has either been disposed of, or is
\u00a0
classified as held for sale,
and represent
\u00a0
a separate
\u00a0
major line
\u00a0
of business
\u00a0
or geographical
\u00a0
area of operations.
\u00a0
Discontinued
\u00a0
operations
\u00a0
are excluded
\u00a0
from the results
\u00a0
of
continuing
\u00a0
operations
\u00a0
and are
\u00a0
presented
\u00a0
as a single
\u00a0
amount as
\u00a0
profit or
\u00a0
loss after
\u00a0
tax from
\u00a0
discontinued
\u00a0
operations
\u00a0
in the income
\u00a0
statement.
Discontinued operations are also excluded from segment reporting.
\u00a0
All consolidation procedures are still applicable, and
\u00a0
only external revenues
and expenses
\u00a0
are shown
\u00a0
as discontinued
\u00a0
operations.
Accounting policies
Telenor presents the statement of cash flows
\u00a0
using the indirect method. Cash inflows and
\u00a0
outflows are shown separately for investing and
financing activities, while operating activities include both cash
\u00a0
and non-cash line items. Interest received and paid,
\u00a0
and dividends received, are
reported as a part
\u00a0
of operating activities. Dividends distributed by Telenor
\u00a0
ASA and subsidiaries with non-controlling interests are included
\u00a0
as a
part of financing
\u00a0
activities.
\u00a0
Value-added
\u00a0
tax (VAT)
\u00a0
and other
\u00a0
similar taxes
\u00a0
are regarded
\u00a0
as collection
\u00a0
of tax on
\u00a0
behalf of
\u00a0
authorities
\u00a0
and are
\u00a0
reported
net. Discontinued
\u00a0
operations
\u00a0
are included
\u00a0
in the cash
\u00a0
flow statement
\u00a0
and information
\u00a0
about operating,
\u00a0
financing,
\u00a0
investing
\u00a0
cash flows
\u00a0
from
discontinued
\u00a0
operations
\u00a0
is shown
\u00a0
in note 12.
Accounting policies
\u00a0
Intangible
\u00a0
assets acquired
\u00a0
individually
\u00a0
are measured
\u00a0
initially
\u00a0
at cost and
\u00a0
recognised
\u00a0
as an intangible
\u00a0
assets when
\u00a0
the Group
\u00a0
has control
\u00a0
over the
asset, future
\u00a0
economic
\u00a0
benefits
\u00a0
are expected
\u00a0
to flow to
\u00a0
the Group
\u00a0
and the cost
\u00a0
can be measured
\u00a0
reliably.
\u00a0
The cost
\u00a0
to be capitalised
\u00a0
as part of
\u00a0
the
assets includes direct and incremental costs and,
\u00a0
for qualifying assets, borrowing costs. The cost
\u00a0
of intangible assets acquired in a business
combination
\u00a0
is the fair
\u00a0
value at
\u00a0
the date of
\u00a0
acquisition.
\u00a0
Following
\u00a0
that initial
\u00a0
recognition,
\u00a0
intangible
\u00a0
assets are
\u00a0
carried at
\u00a0
cost less
\u00a0
accumulated
amortisation and any impairment losses.
\u00a0
The straight-line
\u00a0
amortisation method is used for most intangible
\u00a0
assets as this best reflects the
consumption
\u00a0
of the assets.
\u00a0
The amortisation
\u00a0
period for
\u00a0
a customer
\u00a0
base is
\u00a0
the expected
\u00a0
lifetime
\u00a0
of the customer
\u00a0
relationship,
\u00a0
and the amortisation
method is
\u00a0
based on
\u00a0
historical
\u00a0
experience
\u00a0
of churn (customers
\u00a0
ending their
\u00a0
relationship)
\u00a0
for the different
\u00a0
businesses.
\u00a0
The useful
\u00a0
lives and
amortisation methods are reviewed at least annually.
\u00a0
Refer to note 18 for further information
\u00a0
about impairment.
Accounting policies
A lease
\u00a0
liability
\u00a0
and a right-of-use
\u00a0
asset is
\u00a0
recognised
\u00a0
at commencement
\u00a0
date in
\u00a0
lease contracts
\u00a0
where Telenor
\u00a0
has the right
\u00a0
to direct
\u00a0
the use and
obtains substantially
\u00a0
all the economic
\u00a0
benefits
\u00a0
from the
\u00a0
use of an
\u00a0
identified
\u00a0
asset. For
\u00a0
spectrum
\u00a0
contracts,
\u00a0
Telenor
\u00a0
has chosen
\u00a0
to account
\u00a0
for the
right to
\u00a0
use the spectrum
\u00a0
as a lease,
\u00a0
where the
\u00a0
identified
\u00a0
asset is
\u00a0
the frequency
\u00a0
band that
\u00a0
is exclusive
\u00a0
for Telenor
\u00a0
during the
\u00a0
lease period.
\u00a0
Lease
payments on short-term leases
\u00a0
(less than 12 months) and low-value asset leases
\u00a0
(mainly office equipment) are generally expensed on
\u00a0
a straight-line
basis over the lease term. The short-term
\u00a0
exemption does not apply to spectrum leases or
\u00a0
leases with purchase options.
\u00a0
The lease liability represents the net present value
\u00a0
of lease payments over the lease period
\u00a0
and include fixed payments, in-substance fixed
payments, non-lease components, residual value
\u00a0
guarantees and lease incentives. The lease payments also
\u00a0
include the exercise price of a
purchase option reasonably certain to be exercised
\u00a0
and termination penalties when termination is expected.
\u00a0
Variable lease payments such as
licence payments based on revenue sharing arrangements
\u00a0
are expensed as incurred.
The incremental
\u00a0
borrowing
\u00a0
rate generally
\u00a0
used to determine
\u00a0
the net present
\u00a0
value is
\u00a0
based on
\u00a0
the respective
\u00a0
country\u2019s risk-free
\u00a0
rate for
\u00a0
the term
corresponding
\u00a0
to the lease term, adjusted for own
\u00a0
credit risk. Subsidiaries with external financing use
\u00a0
the external borrowing rate corresponding to
The non-cancellable lease period is basis for
\u00a0
the lease liability, and periods covered by
\u00a0
options to extend or terminate the lease are
\u00a0
included only
when it is reasonably certain the lease period
\u00a0
will be extended. The lease liability is remeasured if
\u00a0
the lease term or lease payments change,
\u00a0
or there
are other modifications. Significant amounts paid up-front
\u00a0
on spectrum and other lease contracts are
\u00a0
recognised as prepayment until
Right-of-use assets are measured
\u00a0
at cost, less accumulated depreciation and impairments,
\u00a0
and adjusted for any remeasurement of lease
\u00a0
liabilities.
The right-of-use asset includes estimated costs for
\u00a0
dismantling and removing the underlying leased asset, restoring the
\u00a0
site on which it is located
or restoring the underlying leased asset to the
\u00a0
condition required by the terms and conditions of
\u00a0
the lease. Non-refundable value-added tax
\u00a0
is
included as initial direct cost. The right-of-use asset is
\u00a0
depreciated on a straight-line
\u00a0
basis over the shorter of its estimated
\u00a0
useful life and the lease
term. Right-of-use
\u00a0
assets where
\u00a0
it is reasonably
\u00a0
certain that
\u00a0
Telenor will
\u00a0
exercise
\u00a0
a purchase
\u00a0
option at
\u00a0
the end of
\u00a0
the lease
\u00a0
term are
\u00a0
not
depreciated.
Accounting policies
Property, plant and equipment are recognised at
\u00a0
cost less accumulated depreciation and any impairment
\u00a0
losses.
\u00a0
The cost includes borrowing
costs for
\u00a0
qualifying
\u00a0
assets.
\u00a0
If Telenor
\u00a0
has a legal
\u00a0
or constructive
\u00a0
obligation
\u00a0
to dismantle,
\u00a0
remove
\u00a0
and restore
\u00a0
a site, an
\u00a0
asset retirement
\u00a0
obligation
(ARO) is recognized with a corresponding increase in the
\u00a0
related asset within property, plant and equipment.
\u00a0
AROs primarily relate to base stations
and installed network and infrastructure equipment in
\u00a0
addition to some buildings, refer to note
\u00a0
22 for further information. Estimated useful lives for
similar types of assets may vary between
\u00a0
different geographical areas due to factors such
\u00a0
as growth rate, maturity of the market,
\u00a0
history and
expectations for replacements or transfer of assets,
\u00a0
climate and quality of components used. Estimated useful
\u00a0
life, depreciation method and
residual
\u00a0
value are
\u00a0
evaluated
\u00a0
at least annually.
\u00a0
The straight-line
\u00a0
depreciation
\u00a0
method is
\u00a0
used as this
\u00a0
best reflects
\u00a0
the consumption
\u00a0
of the assets,
which often is the passage of time.
\u00a0
Residual value is estimated to be zero for
\u00a0
most assets, except for some commercial buildings
\u00a0
and vehicles that
are not expected to be used for
\u00a0
the whole economic life. Refer to note
\u00a0
18 for further information about impairment.
Accounting policies
Impairment indicators are assessed at each reporting
\u00a0
date for individual assets and cash generating units
\u00a0
(CGUs),
\u00a0
and impairment testing is
performed if any indicators are identified. Goodwill, intangible
\u00a0
assets with indefinite useful life and intangible assets
\u00a0
not yet brought into use are
assessed for impairment annually or when impairment indicators
\u00a0
are identified. Identification of Telenor\u2019s main CGUs is
\u00a0
based on the countries
where Telenor operates its fixed and mobile
\u00a0
operations. The CGU may include both fixed and mobile
\u00a0
operations as they are monitored and
reported as one operating unit.
\u00a0
Goodwill arising from acquisitions are allocated to the
\u00a0
respective CGU and included in the impairment
\u00a0
test. Fair
values are
\u00a0
used in the
\u00a0
CGU testing
\u00a0
when these
\u00a0
are available,
\u00a0
for example
\u00a0
when the
\u00a0
CGU is a listed
\u00a0
company.
\u00a0
In assessing
\u00a0
value-in-use,
\u00a0
the
estimated
\u00a0
future cash
\u00a0
flows are
\u00a0
discounted
\u00a0
to their
\u00a0
present value
\u00a0
using a
\u00a0
discount rate
\u00a0
based on
\u00a0
the weighted
\u00a0
average cost
\u00a0
of capital
\u00a0
(WACC) rate.
The WACC
\u00a0
reflects
\u00a0
current market
\u00a0
assessments
\u00a0
of the time
\u00a0
value of
\u00a0
money and
\u00a0
the risks
\u00a0
specific
\u00a0
to the asset
\u00a0
or the CGU
\u00a0
to which
\u00a0
the asset
belongs. Impairments are recognised by reducing carrying
\u00a0
amount of goodwill first before other assets
\u00a0
are reduced on a pro-rata basis.
Impairments
\u00a0
of goodwill
\u00a0
are not reversed.
Accounting policies
Trade and other receivables are recognised at fair value including
\u00a0
directly attributable transaction costs and subsequently measured at
amortised cost using the effective interest rate method. A customer
\u00a0
contract asset is recognised when the revenue from contracts with
customers exceeds the amounts received,
\u00a0
for example when sale of handsets
\u00a0
or other customer equipment is recovered through future
subscription fee payments. Contract assets are transferred to trade receivables
\u00a0
when the rights to payment become unconditional, which
is normally when the invoice has been issued. Refer
\u00a0
to further information in note 3 Revenues.
Accounting policies
Cash and cash equivalents include bank deposits,
\u00a0
fixed rate bonds and commercial papers with original maturity
\u00a0
of three months or less which are
readily convertible
\u00a0
to known
\u00a0
amount of
\u00a0
cash and
\u00a0
subject to
\u00a0
insignificant
\u00a0
risk.
Accounting policies
Defined contribution plans
A defined contribution plan is a type of
\u00a0
retirement plan where the employer makes contributions on
\u00a0
a regular basis to the employee\u2019s individual
pension account. The benefits received by the
\u00a0
employee are based on the employer contributions and gains
\u00a0
or losses from investing the capital.
Contributions
\u00a0
to defined contribution pension plans are recognised
\u00a0
as an expense in the income statement
\u00a0
as incurred.
Defined benefit plans
A defined benefit plan is a pension plan
\u00a0
where the employer promises an annual pension
\u00a0
on retirement based on a percentage of
\u00a0
the salary upon
retirement and the employee's earnings history, years
\u00a0
of service and age. The pension obligations are
\u00a0
determined by discounting the estimated
future pension
\u00a0
cash outflows
\u00a0
less the
\u00a0
fair value
\u00a0
of plan assets.
\u00a0
The discount
\u00a0
rate is based
\u00a0
on interest
\u00a0
rates of
\u00a0
high-quality
\u00a0
corporate
\u00a0
bonds
denominated in the same currency and with
\u00a0
similar maturity as the related pension obligation. The defined
\u00a0
benefit obligation is calculated annually
by independent
\u00a0
actuaries
\u00a0
using the
\u00a0
projected
\u00a0
unit credit
\u00a0
method.
Current and
\u00a0
past service
\u00a0
cost in
\u00a0
addition
\u00a0
to non-routine
\u00a0
pension settlements,
\u00a0
is presented
\u00a0
as salaries
\u00a0
and personnel
\u00a0
costs, and
\u00a0
the net interest
expense is recognised as financial expense in
\u00a0
the income statement. Remeasurements including actuarial gains and losses and
\u00a0
the return on plan
assets exceeding the discount rate are recognised
\u00a0
in the statement of comprehensive income and
\u00a0
are not subsequently reclassified to the income
statement.
A plan curtailment is when Telenor is committed
\u00a0
to reduce the number of employees in a
\u00a0
plan or change the terms, so the
\u00a0
employees are entitled
to reduced benefits or is no longer
\u00a0
eligible for benefits. Past service cost is recognised in
\u00a0
the income statement on the earlier of
\u00a0
the date of the plan
amendment
\u00a0
or curtailment
\u00a0
or when
\u00a0
the related
\u00a0
restructuring
\u00a0
cost is recognised.
\u00a0
Gains and
\u00a0
losses on
\u00a0
curtailments
\u00a0
form part
\u00a0
of service
\u00a0
cost and
\u00a0
are
presented
\u00a0
as part of
\u00a0
other income
\u00a0
or other expenses
\u00a0
in the income
\u00a0
statement.
\u00a0
Defined benefit multi-employer plans
\u00a0
(such as the AFP arrangement in
\u00a0
Norway) are accounted for as defined contribution
\u00a0
plans when insufficient
information
\u00a0
is available
\u00a0
to calculate
\u00a0
Telenor\u2019s
\u00a0
proportionate
\u00a0
share.
Accounting policies
Provisions such as for asset retirement obligations,
\u00a0
workforce reductions, onerous contracts and legal claims
\u00a0
are recognised when there is a
present legal
\u00a0
or constructive
\u00a0
obligation
\u00a0
as a result
\u00a0
of past events,
\u00a0
it is probable
\u00a0
that an outflow
\u00a0
of resources
\u00a0
will be
\u00a0
required
\u00a0
to settle
\u00a0
the obligation,
and the amount
\u00a0
can be reliably
\u00a0
estimated.
\u00a0
Provisions
\u00a0
are measured
\u00a0
at management\u2019s
\u00a0
best estimate
\u00a0
of the expenditure
\u00a0
required
\u00a0
to settle
\u00a0
the
obligation
\u00a0
at the reporting
\u00a0
date and
\u00a0
are discounted
\u00a0
to present
\u00a0
value. Asset
\u00a0
retirement
\u00a0
obligations
\u00a0
(ARO) primarily
\u00a0
relate to
\u00a0
base stations
\u00a0
and
installed
\u00a0
network and
\u00a0
infrastructure
\u00a0
equipment
\u00a0
in addition
\u00a0
to some buildings,
\u00a0
see note
\u00a0
17. The
\u00a0
net present
\u00a0
value of
\u00a0
the future
\u00a0
ARO is discounted
using a
\u00a0
pre-tax risk-free
\u00a0
rate as risks
\u00a0
are reflected
\u00a0
in the cash
\u00a0
flows. Upon
\u00a0
recognition
\u00a0
of an asset
\u00a0
retirement
\u00a0
obligation,
\u00a0
a corresponding
\u00a0
amount is
recognised
\u00a0
as an increase
\u00a0
of the related
\u00a0
asset within
\u00a0
property,
\u00a0
plant and
\u00a0
equipment
\u00a0
with subsequent
\u00a0
depreciation
\u00a0
over the useful
\u00a0
life of the
\u00a0
asset.
After the initial recognition, an accretion expense
\u00a0
is recognised as finance cost. Any subsequent
\u00a0
adjustments of the asset retirement obligation
from changes
\u00a0
of the removal
\u00a0
costs or discount
\u00a0
rates will
\u00a0
have a corresponding
\u00a0
adjustment
\u00a0
to the carrying
\u00a0
value of
\u00a0
the property,
\u00a0
plant and
equipment.
Accounting policies
Legal disputes
\u00a0
are usually
\u00a0
contingent
\u00a0
in nature,
\u00a0
meaning
\u00a0
the possible
\u00a0
obligation
\u00a0
depends
\u00a0
on future
\u00a0
events outside
\u00a0
the company\u2019s
\u00a0
control,
\u00a0
for
example a court decision. Provisions are made
\u00a0
for legal claims where an unfavorable
\u00a0
outcome is probable and the amount required to
\u00a0
settle the
dispute can be reliably estimated. Provisions are based on
\u00a0
management\u2019s best estimate of the amount required
\u00a0
to settle the obligation discounted
Accounting policies
Trade and other payables relate to amounts
\u00a0
owed to suppliers and customer contract liabilities
\u00a0
include amounts received from a customer that
exceed the revenue recognised, for example prepaid subscriptions.
\u00a0
Customer contract liabilities are expected to be realised within
\u00a0
in the Group\u2019s
normal operating
\u00a0
cycle and
\u00a0
are classified
\u00a0
as current.
Accounting policies
Costs of obtaining customer contracts include commissions
\u00a0
to dealers and costs for fulfilling a
\u00a0
contract include connection and installation of
equipment on customer premises, including direct labour and material
\u00a0
costs. When such costs are incremental and expected
\u00a0
to be recovered, they
are capitalised
\u00a0
as contract
\u00a0
cost assets
\u00a0
and amortised
\u00a0
over the
\u00a0
expected
\u00a0
customer lifetime.
\u00a0
Renewal periods
\u00a0
are included
\u00a0
in the period
\u00a0
based on
historical churn data, unless new costs
\u00a0
are incurred on contract renewals. These costs are
\u00a0
included in EBITDA. The practical expedient of not
capitalising contract costs that would have been
\u00a0
amortised within 12 months has been applied.
Accounting policies
Financial
\u00a0
assets and
\u00a0
liabilities
A financial instrument is defined as any
\u00a0
contract that gives rise to a financial
\u00a0
asset of one entity and a financial liability or
\u00a0
equity instrument of
another entity. The financial instruments are recognised in
\u00a0
the statement of financial position when Telenor becomes
\u00a0
a party to the contractual
provisions of the instrument, using trade date
\u00a0
accounting. Financial assets and liabilities are offset
\u00a0
when there is intention and legally enforceable
right to
\u00a0
settle the
\u00a0
contracts
\u00a0
net.
Categories
\u00a0
of financial
\u00a0
assets and
\u00a0
liabilities
The categorisation of the financial instrument for
\u00a0
measurement purposes is based on the objective and
\u00a0
the contractual cash flow characteristics
determined at initial recognition. Telenor does not
\u00a0
apply the fair value option.
Telenor has financial assets classified in the following
\u00a0
measurement categories:
\u00a0
\u25cf
FAAC - financial
\u00a0
assets at
\u00a0
amortised
\u00a0
cost. Consist
\u00a0
of financial
\u00a0
assets held
\u00a0
to collect
\u00a0
contractual
\u00a0
cash flows
\u00a0
that are
\u00a0
solely payments
\u00a0
of
principal
\u00a0
and interest.
\u25cf
FVTOCI -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through other
\u00a0
comprehensive
\u00a0
income. Consist
\u00a0
of equity
\u00a0
investments
\u00a0
not held
\u00a0
for trading.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes,
\u00a0
assets held
\u00a0
for
trading
\u00a0
and financial
\u00a0
assets that
\u00a0
are not
\u00a0
classified
\u00a0
in one of
\u00a0
the other
\u00a0
categories.
Telenor has financial liabilities classified in the following
\u00a0
categories:
\u00a0
\u25cf
FLAC - financial
\u00a0
liabilities
\u00a0
at amortised
\u00a0
cost. Consist
\u00a0
of liabilities
\u00a0
that are
\u00a0
not a part
\u00a0
of the category
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
liabilities
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes and
\u00a0
other liabilities
Equity investments include equity instruments and capital contribution
\u00a0
to Telenor Pension Fund. Equity investments not
\u00a0
held for trading are
financial assets with changes in fair value
\u00a0
through other comprehensive income (FVTOCI).
\u00a0
Unrealised gains and losses are reclassified within equity
from other
\u00a0
reserves
\u00a0
to retained
\u00a0
earnings
\u00a0
when the
\u00a0
investment
\u00a0
is disposed.
\u00a0
Equity investments
\u00a0
held for
\u00a0
trading
\u00a0
are financial
\u00a0
assets with
\u00a0
changes in
fair value through profit and loss (FVTPL), and
\u00a0
transaction costs are immediately expensed. Telenor does currently
\u00a0
not have equity instruments held
for trading.
Telenor
\u00a0
uses derivative
\u00a0
financial
\u00a0
instruments
\u00a0
such as forward
\u00a0
currency
\u00a0
contracts,
\u00a0
interest rate
\u00a0
swaps and
\u00a0
cross currency
\u00a0
interest
\u00a0
rate swaps
\u00a0
to
hedge its risks associated with interest rate
\u00a0
and foreign currency fluctuations. The derivative financial instruments are
\u00a0
measured at fair value. Any
gains or
\u00a0
losses arising
\u00a0
from changes
\u00a0
in fair
\u00a0
value on derivatives
\u00a0
that are
\u00a0
not cash flow
\u00a0
hedges or
\u00a0
hedges of
\u00a0
net investments
\u00a0
are recognised
\u00a0
in the
income statement as financial income or expense.
\u00a0
Embedded derivatives
\u00a0
Embedded derivatives are separated from the host
\u00a0
contract and recognised
\u00a0
at fair value, except when the risks and
\u00a0
economic characteristics are
closely
\u00a0
related to
\u00a0
the host contract
\u00a0
and the host
\u00a0
contract
\u00a0
is not carried
\u00a0
at fair value.
\u00a0
The currency
\u00a0
derivative
\u00a0
embedded
\u00a0
in committed
\u00a0
purchase or
sales contracts
\u00a0
are not separated
\u00a0
when the
\u00a0
payment is
\u00a0
in one of
\u00a0
the party\u2019s
\u00a0
functional
\u00a0
currency
\u00a0
or in a commonly
\u00a0
used currency
\u00a0
in the relevant
economic environment. Unrealised gains or losses are
\u00a0
recognised in the income statement.
\u00a0
Other current and non-current financial assets
Financial
\u00a0
assets such
\u00a0
as various
\u00a0
receivables
\u00a0
and deposits
\u00a0
initially
\u00a0
recognised
\u00a0
at fair
\u00a0
value including
\u00a0
directly attributable
\u00a0
transactions
\u00a0
costs and
subsequently measured at amortised cost using the
\u00a0
effective interest rate method. These financial assets
\u00a0
are adjusted for provision for
impairment in accordance with the expected credit loss
\u00a0
model.
\u00a0
Lease receivables
In finance
\u00a0
leases, a
\u00a0
lease receivable
\u00a0
is recognised
\u00a0
based on
\u00a0
future expected
\u00a0
lease payments,
\u00a0
and finance
\u00a0
income is
\u00a0
allocated
\u00a0
using a
\u00a0
constant
periodic
\u00a0
rate of return
\u00a0
over the
\u00a0
lease term.
\u00a0
In a transaction
\u00a0
for which
\u00a0
an underlying
\u00a0
asset is
\u00a0
sub-leased
\u00a0
to a third
\u00a0
party, the
\u00a0
sublease is
\u00a0
classified
\u00a0
as a
finance or
\u00a0
operating
\u00a0
lease by
\u00a0
reference
\u00a0
to the right-of-use
\u00a0
asset arising
\u00a0
from the
\u00a0
head lease.
\u00a0
See note
\u00a0
3 for further
\u00a0
information
\u00a0
about operation
lease revenue.
Accounting policies
Interest-bearing
\u00a0
liabilities
\u00a0
are initially
\u00a0
measured
\u00a0
at fair value
\u00a0
net of transaction
\u00a0
costs and
\u00a0
are subsequently
\u00a0
measured
\u00a0
at amortised
\u00a0
cost using
\u00a0
the
effective
\u00a0
interest-rate
\u00a0
method (FLAC).
\u00a0
In addition,
\u00a0
where fair
\u00a0
value hedge
\u00a0
accounting
\u00a0
is applied
\u00a0
the hedged
\u00a0
liabilities
\u00a0
are adjusted
\u00a0
for gains
\u00a0
and
losses attributable
\u00a0
to the risk
\u00a0
being hedged.
\u00a0
On extinguishment
\u00a0
of debt,
\u00a0
in whole
\u00a0
or in part,
\u00a0
the difference
\u00a0
between
\u00a0
the carrying
\u00a0
amount of
\u00a0
the
liability and the consideration paid is recognised
\u00a0
in the income statement.
Accounting policies
Hedge accounting is applied for fair value
\u00a0
hedges and hedges of net investments in foreign
\u00a0
operations when the hedging criteria are met.
\u00a0
For fair
value
\u00a0
hedges, the carrying amount of the hedged
\u00a0
item is adjusted for gains and losses attributable
\u00a0
to the risk being hedged. The derivative is also
measured at fair value, and gains and losses
\u00a0
from both the hedging instrument and the hedged
\u00a0
item are recognised in the income statement.
Hedge effectiveness
\u00a0
is assessed
\u00a0
on an ongoing
\u00a0
basis, and
\u00a0
hedge accounting
\u00a0
is discontinued
\u00a0
if the hedge
\u00a0
no longer
\u00a0
meets the
\u00a0
hedge accounting
criteria.
\u00a0
If the hedged
\u00a0
item still
\u00a0
exists and
\u00a0
is not sold,
\u00a0
the fair
\u00a0
value adjustment
\u00a0
to the hedged
\u00a0
item attributable
\u00a0
to the risk
\u00a0
being hedged
\u00a0
at de-
designation
\u00a0
will be
\u00a0
amortised
\u00a0
in the income
\u00a0
statement
\u00a0
over the
\u00a0
remaining
\u00a0
time to maturity.
\u00a0
A hedge
\u00a0
of a net investment
\u00a0
in a foreign
\u00a0
operation
\u00a0
is accounted
\u00a0
for in a
\u00a0
similar way
\u00a0
as a cash
\u00a0
flow hedge.
\u00a0
Foreign exchange
\u00a0
gains or
\u00a0
losses on
\u00a0
the
hedging instrument relating to the effective portion of
\u00a0
the hedge are recognised directly in other
\u00a0
comprehensive income while any foreign
exchange gains or losses relating to the
\u00a0
ineffective portion are recognised in the income statement.
\u00a0
On disposal of the foreign entity, the
cumulative foreign exchange gains or losses recognised in
\u00a0
other comprehensive income is reclassified to the
\u00a0
income statement.
Refer to
\u00a0
note 27 Financial
\u00a0
assets and
\u00a0
liabilities
\u00a0
for further
\u00a0
information
\u00a0
on accounting
\u00a0
policies
\u00a0
for derivatives.
.
Fair value
\u00a0
hierarchy
Telenor
\u00a0
measures fair
\u00a0
values using
\u00a0
the following
\u00a0
fair value
\u00a0
hierarchy
\u00a0
that reflects
\u00a0
the significance
\u00a0
of the inputs
\u00a0
used in measuring
\u00a0
fair value:
Level 1
:
\u00a0
Quoted prices
\u00a0
(unadjusted)
\u00a0
in active
\u00a0
markets for
\u00a0
identical
\u00a0
financial
\u00a0
instruments
Level 2:
\u00a0
Inputs other than quoted prices included within
\u00a0
Level 1 that are observable for assets or
\u00a0
liabilities, either directly (i.e. as prices) or
indirectly (i.e. derived from prices).
\u00a0
Level 3:
\u00a0
Inputs for assets or liabilities that are
\u00a0
not based on observable market data (unobservable
\u00a0
inputs).
Accounting policies
\u00a0
Associates
\u00a0
are those
\u00a0
entities
\u00a0
where Telenor
\u00a0
has significant
\u00a0
influence,
\u00a0
but not control
\u00a0
or joint control,
\u00a0
usually
\u00a0
between
\u00a0
20 to 50 percent
\u00a0
voting
power. Joint
\u00a0
ventures are
\u00a0
those entities
\u00a0
where unanimous
\u00a0
consent
\u00a0
is required
\u00a0
by the owners
\u00a0
on important
\u00a0
decision
\u00a0
and where
\u00a0
the parties
\u00a0
have
rights to net assets. Interests in joint
\u00a0
ventures and associates are accounted for using
\u00a0
the equity method. The investments are initially
\u00a0
recognised
at cost (including transaction costs) and subsequently
\u00a0
adjusted for the share of profits and
\u00a0
losses, dividends received and impairment. The profit
and losses
\u00a0
are presented
\u00a0
on a separate
\u00a0
line in the
\u00a0
income statement.
An investment
\u00a0
is a joint
\u00a0
operation
\u00a0
when unanimous
\u00a0
consent is
\u00a0
required
\u00a0
by the owners
\u00a0
on important
\u00a0
decisions
\u00a0
and Telenor
\u00a0
and the parties
\u00a0
have
rights to
\u00a0
specific
\u00a0
assets and
\u00a0
obligations.
\u00a0
These entities
\u00a0
are consolidated
\u00a0
on a line-by-line
\u00a0
basis with
\u00a0
a share of
\u00a0
revenues and
\u00a0
costs, and
\u00a0
the specific
assets and
\u00a0
liabilities
\u00a0
or the proportionate
\u00a0
share of
\u00a0
jointly
\u00a0
owned assets
\u00a0
and liabilities.
For investments
\u00a0
where financial
\u00a0
statements
\u00a0
are not
\u00a0
available
\u00a0
at the time
\u00a0
Telenor publishes
\u00a0
its report,
\u00a0
the share
\u00a0
of net income
\u00a0
is recognised
\u00a0
with a
one quarter
\u00a0
lag. Adjustments
\u00a0
are made
\u00a0
for significant
\u00a0
transactions
\u00a0
or events
\u00a0
known in
\u00a0
the market.
\u00a0
To ensure
\u00a0
consistency,
\u00a0
the Annual
\u00a0
Report is
\u00a0
not
updated in situations where the financial statements
\u00a0
for the investee are made available after fourth
\u00a0
quarter and before the issuance of the
\u00a0
Annual
Report, unless
\u00a0
the transactions
\u00a0
or events
\u00a0
are significant.
Accounting policies
The consolidated financial statements include the financial
\u00a0
statements of Telenor ASA and entities controlled
\u00a0
by Telenor ASA. Control normally
exists when
\u00a0
the Group
\u00a0
has more
\u00a0
than 50%
\u00a0
of the voting
\u00a0
power through
\u00a0
ownership
\u00a0
or agreements,
\u00a0
except where
\u00a0
non-controlling
\u00a0
interests prevent
the exercise of control. Subsidiaries have the
\u00a0
same reporting periods as the parent company
\u00a0
and use consistent accounting policies. Intercompany
transactions, balances, revenues, expenses and unrealised
\u00a0
internal profit or losses are eliminated on consolidation. Non-controlling
\u00a0
interests in
subsidiaries are presented within equity separately from the equity attributable
\u00a0
to the owners of the parent, refer
\u00a0
to note 28. Non-controlling
interests
\u00a0
have been
\u00a0
measured
\u00a0
at the proportionate
\u00a0
fair value
\u00a0
of net identifiable
\u00a0
assets at
\u00a0
the date
\u00a0
of the business
\u00a0
combination
\u00a0
and share
\u00a0
of
changes in
\u00a0
equity since
\u00a0
the date
\u00a0
of the business
\u00a0
combination.
Accounting policies
Goodwill
\u00a0
arises in business combinations as the difference
\u00a0
between the consideration and the acquired business\u2019
\u00a0
identifiable assets and assumed
liabilities at the acquisition date. Assets and
\u00a0
liabilities are generally recognised at fair value, except for
\u00a0
non-current assets classified as held for sale
and deferred
\u00a0
taxes which
\u00a0
are recognised
\u00a0
at nominal
\u00a0
value. The
\u00a0
fair value
\u00a0
of any previously
\u00a0
held equity
\u00a0
interests
\u00a0
and the amount
\u00a0
of any non-
controlling interest is also included when determining the
\u00a0
amount of goodwill.
Other income and other expenses are items
\u00a0
that are not regarded as part of
\u00a0
regular operational performance. The purpose of presenting these
items on a separate line is to enable
\u00a0
comparison of profitability between periods. It includes gains
\u00a0
and losses on disposal of non-current
\u00a0
assets
such as property,
\u00a0
plant and
\u00a0
equipment
\u00a0
(PPE) and
\u00a0
intangible
\u00a0
assets. It
\u00a0
also includes
\u00a0
gains and
\u00a0
losses from
\u00a0
sale of
\u00a0
subsidiaries,
\u00a0
unless the
\u00a0
sale is
presented as discontinued operations. Restructuring costs are
\u00a0
included to the extent they qualify as
\u00a0
a restructuring in IAS 37. Costs related to
reduction
\u00a0
of personnel
\u00a0
is only included
\u00a0
when they
\u00a0
relate to
\u00a0
the time the
\u00a0
employee
\u00a0
no longer
\u00a0
render services
\u00a0
to Telenor.
\u00a0
Costs for loss
\u00a0
contracts
\u00a0
are
included when they qualify as onerous contracts
\u00a0
under IAS 37. Fines concluded in legal disputes
\u00a0
are included, whereas settlements on legal
disputes
\u00a0
are only
\u00a0
included
\u00a0
in other
\u00a0
income and
\u00a0
expense
\u00a0
when they
\u00a0
relate to
\u00a0
the business
\u00a0
as a whole
\u00a0
and are
\u00a0
non-recurring
\u00a0
in nature.
Descriptions
\u00a0
of accounting principles are generally included in the
various notes to the financial statements. The general principles
\u00a0
relating
to foreign
\u00a0
currency
\u00a0
translation,
\u00a0
distinction
\u00a0
between
\u00a0
current
\u00a0
and non-
current assets and liabilities and government grants
\u00a0
are described
below.
Foreign currency
\u00a0
translation
\u00a0
The consolidated financial statements are presented in
\u00a0
NOK, which is
Telenor ASA\u2019s functional currency. The group has foreign
\u00a0
entities with
functional
\u00a0
currency
\u00a0
other than
\u00a0
NOK. At
\u00a0
the reporting
\u00a0
date, the
\u00a0
assets
and liabilities of foreign entities with functional
\u00a0
currencies other than
NOK are translated
\u00a0
into NOK at
\u00a0
the rate
\u00a0
of exchange
\u00a0
at the reporting
date. The income statements are translated at the
\u00a0
average exchange
rates for
\u00a0
the year
\u00a0
except significant
\u00a0
transactions
\u00a0
that are
\u00a0
translated
using the daily exchange rate. The translation
\u00a0
differences arising from
the translation are recognised in other comprehensive
\u00a0
income until the
disposal of the net investment, at
\u00a0
which time they are recognised in the
income statement.
Current/non-current
\u00a0
classification
An asset or liability is classified as current
\u00a0
when it is expected to be
realised, sold, used or settled in Telenor\u2019s
\u00a0
normal operating cycle, which
is normally
\u00a0
within twelve
\u00a0
months after
\u00a0
the reporting
\u00a0
date. Other
\u00a0
assets
and liabilities are classified as non-current.
\u00a0
Financial instruments, other
than those held for trading, are classified
\u00a0
based on maturity, and
hedging instruments are classified consistently with the underlying
hedged item.
Government grants are recognised when there is
\u00a0
reasonable assurance
that the grant
\u00a0
will be
\u00a0
received.
\u00a0
Grants that
\u00a0
relate to
\u00a0
expenses
\u00a0
are
normally recognised as a reduction of the
\u00a0
expense over the related
period.
\u00a0
Grants that relate to assets
\u00a0
are deducted from the carrying
amount of the asset and result in
\u00a0
lower depreciation over the useful life
of the asset.
Accounting policies
Services
Service revenues
\u00a0
include
\u00a0
subscriptions
\u00a0
and traffic
\u00a0
revenues for
\u00a0
mobile
\u00a0
voice and
\u00a0
data. Subscriptions
\u00a0
are either
\u00a0
invoiced
\u00a0
on a monthly
\u00a0
basis or
prepaid.
\u00a0
Outbound roaming
\u00a0
charges in
\u00a0
addition
\u00a0
to voice
\u00a0
and non-voice
\u00a0
traffic
\u00a0
fees are
\u00a0
recognised
\u00a0
based on the
\u00a0
minutes or
\u00a0
data used.
\u00a0
Other mobile
services include subscriptions and services for machine-to-machine
\u00a0
and internet-of-things (IoT), inbound and national roaming
\u00a0
and revenues
related to service providers and MVNOs (Mobile
\u00a0
Virtual Network Operators). Interconnect fees are revenues
\u00a0
from other operators
\u00a0
using Telenor\u2019s
networks. Service revenues are recognised
\u00a0
over time or based on usage.
Fixed-network
\u00a0
services include revenues from telephony, internet,
\u00a0
TV, broadcasting and data services.
\u00a0
The subscription fees are usually flat rate,
where some contracts have a minimum contract
\u00a0
term. Fixed service revenues are recognised
\u00a0
over time or based on usage.
\u00a0
Goods
Revenues from the sale of mobile phones, broadband
\u00a0
set-up boxes and other devices are
\u00a0
recognised at point in time when the equipment
\u00a0
is
delivered
\u00a0
to the customer.
Bundled multi-element contracts
Bundled multi-element contracts
\u00a0
are contracts that consist of several
\u00a0
separate identifiable performance obligations. Within mobile operations this
typically include a subscription, a handset and sometimes
\u00a0
screen insurance and other services. Within our
\u00a0
fixed operations this typically include
subscription, set-up boxes and other
\u00a0
types of equipment or services.
\u00a0
The transaction
\u00a0
price is
\u00a0
net of discounts
\u00a0
and sales
\u00a0
related
\u00a0
taxes. Bundled
\u00a0
contracts
\u00a0
may include
\u00a0
a financing
\u00a0
component,
\u00a0
as the handset
\u00a0
or other
equipment is provided to a customer up-front
\u00a0
and payments
\u00a0
are received over an instalment period. Financing components
\u00a0
are not considered
when the
\u00a0
timing of
\u00a0
the payment
\u00a0
is at the
\u00a0
discretion
\u00a0
of the customer
\u00a0
(for example
\u00a0
prepaid mobile
\u00a0
services)
\u00a0
or the timing
\u00a0
difference
\u00a0
between
rendering
\u00a0
the service
\u00a0
or good and
\u00a0
payment is
\u00a0
less than
\u00a0
twelve months.
\u00a0
If a significant
\u00a0
financing
\u00a0
component is
\u00a0
provided
\u00a0
to the customer,
\u00a0
the
transaction price is adjusted, and interest revenue
\u00a0
is recognised over the customer\u2019s payment period
\u00a0
using an interest rate reflecting the relevant
risk-free
\u00a0
rate and
\u00a0
customer specific
\u00a0
credit risk.
The transaction price for bundled contracts is allocated
\u00a0
to each identified performance obligation based on
\u00a0
relative prices Telenor would achieve
by selling the same
\u00a0
goods or services to a similar customer
\u00a0
on a stand-alone basis.
\u00a0
Discounts are allocated proportionately to all performance
obligations
\u00a0
in the contract
\u00a0
unless there
\u00a0
is observable
\u00a0
evidence
\u00a0
to allocate
\u00a0
it differently.
\u00a0
Mobile swap contracts
\u00a0
The Group
\u00a0
offers in
\u00a0
some markets
\u00a0
sale of
\u00a0
handsets on
\u00a0
instalment
\u00a0
plans with
\u00a0
an option
\u00a0
for the customer
\u00a0
to change
\u00a0
to a new
\u00a0
device before
\u00a0
all the
instalments
\u00a0
are paid.
\u00a0
If the option
\u00a0
is exercised,
\u00a0
the customer
\u00a0
pays any
\u00a0
remaining
\u00a0
months of
\u00a0
minimum
\u00a0
instalment
\u00a0
under the
\u00a0
original
\u00a0
contract and
enters into
\u00a0
a new contract.
\u00a0
The transaction
\u00a0
price at
\u00a0
inception
\u00a0
of the contract
\u00a0
includes
\u00a0
an estimate
\u00a0
of the payments
\u00a0
to be received
\u00a0
based on the
expected value approach using historical data. When the
\u00a0
Group is obliged to accept return of
\u00a0
the original handset, a refund liability is recognised
\u00a0
at
the inception
\u00a0
of the contract.
\u00a0
A returned-good
\u00a0
asset with
\u00a0
a corresponding
\u00a0
adjustment
\u00a0
to cost
\u00a0
of sales
\u00a0
is recognised
\u00a0
representing
\u00a0
the right
\u00a0
to
recover the returned handsets. The new device
\u00a0
is accounted for as a new, separate contract.
\u00a0
Telenor as
\u00a0
agent
\u00a0
In some markets,
\u00a0
mobile subscriptions
\u00a0
and devices
\u00a0
are sold
\u00a0
as bundles
\u00a0
through external
\u00a0
channels.
\u00a0
The group
\u00a0
acts as principal
\u00a0
for the subscription
services
\u00a0
and recognise
\u00a0
the revenues
\u00a0
on a gross
\u00a0
basis. For
\u00a0
the sale
\u00a0
of the handset
\u00a0
an assessment
\u00a0
is made
\u00a0
to determine
\u00a0
if Telenor
\u00a0
is agent
\u00a0
or
principal. If Telenor is regarded as an agent, no revenue
\u00a0
is recognised as there are no commissions
\u00a0
earned for providing services in the capacity of
an agent in these arrangements.
\u00a0
Further, Telenor is acting as an agent
\u00a0
in arrangements where third parties are the main
\u00a0
supplier and the Group
mainly arrange for those goods or services
\u00a0
to be provided by the third party.
\u00a0
For example, screen insurance which is offered
\u00a0
as part of a bundled
offering
\u00a0
in some mobile
\u00a0
subscriptions.
\u00a0
Other revenues
Revenues other than mobile and fixed operations
\u00a0
are mainly offered by units not separately
\u00a0
identified as reporting segments. Revenues include
colocation services, data centre facilities, telemetrics (communication
\u00a0
between machines), satellite services, maritime services and
\u00a0
Internet of
Things (IoT).
\u00a0
Revenues are
\u00a0
recognised
\u00a0
over time
\u00a0
based on
\u00a0
either monthly
\u00a0
fees or usage.
\u00a0
Lease revenues
\u00a0
(IFRS 16)
The Group
\u00a0
has operating
\u00a0
lease arrangements
\u00a0
in which
\u00a0
it is a lessor,
\u00a0
mainly related
\u00a0
to passive
\u00a0
infrastructure
\u00a0
sharing with
\u00a0
other telecommunication
operators. The Group has classified these leases
\u00a0
as operating leases because they do not
\u00a0
transfer substantially all the risks and rewards incidental
to ownership
\u00a0
of the underlying
\u00a0
assets. Lease
\u00a0
revenues are
\u00a0
recognised
\u00a0
on a straight-line
\u00a0
basis over
\u00a0
the lease
\u00a0
term.
NOTE 4
Costs of materials and traffic charges
Cost of materials
\u00a0
and traffic charges
NOK in millions
2022
2021
(11 823)
(11 397)
Cost of materials
\u00a0
etc
(14 580)
(14 194)
Total costs of materials and traffic charges
(26 404)
(25 591)
Cost of materials
\u00a0
include
\u00a0
variable lease
\u00a0
expenses,
\u00a0
see note
\u00a0
16 for more
\u00a0
information.
Power purchase agreements
As part of
\u00a0
Telenor\u2019s
\u00a0
commitment
\u00a0
to reduce
\u00a0
our greenhouse
\u00a0
gas emissions
\u00a0
and meet
\u00a0
our science-based
\u00a0
targets,
\u00a0
Telenor
\u00a0
has in 2022
\u00a0
entered into
Power Purchase Agreements with different vendors for
\u00a0
the provision of renewable energy to Telenor\u2019s
\u00a0
operations. These agreements are fixed
price agreements
\u00a0
and the first
\u00a0
agreement
\u00a0
is expected
\u00a0
to be effective
\u00a0
from end
\u00a0
of 2023.
\u00a0
As these agreements
\u00a0
are entered
\u00a0
into and will
\u00a0
continue to
be held
\u00a0
for the purpose
\u00a0
of receiving
\u00a0
energy for
\u00a0
own usage
\u00a0
within Telenor\u2019s
\u00a0
operations,
\u00a0
they will
\u00a0
be recognised
\u00a0
as cost of
\u00a0
materials
\u00a0
and traffic
charges when effective.
NOTE 4
Costs of materials and traffic charges
Cost of materials
\u00a0
and traffic charges
NOK in millions
2022
2021
(11 823)
(11 397)
Cost of materials
\u00a0
etc
(14 580)
(14 194)
Total costs of materials and traffic charges
(26 404)
(25 591)
Cost of materials
\u00a0
include
\u00a0
variable lease
\u00a0
expenses,
\u00a0
see note
\u00a0
16 for more
\u00a0
information.
Power purchase agreements
As part of
\u00a0
Telenor\u2019s
\u00a0
commitment
\u00a0
to reduce
\u00a0
our greenhouse
\u00a0
gas emissions
\u00a0
and meet
\u00a0
our science-based
\u00a0
targets,
\u00a0
Telenor
\u00a0
has in 2022
\u00a0
entered into
Power Purchase Agreements with different vendors for
\u00a0
the provision of renewable energy to Telenor\u2019s
\u00a0
operations. These agreements are fixed
price agreements
\u00a0
and the first
\u00a0
agreement
\u00a0
is expected
\u00a0
to be effective
\u00a0
from end
\u00a0
of 2023.
\u00a0
As these agreements
\u00a0
are entered
\u00a0
into and will
\u00a0
continue to
be held
\u00a0
for the purpose
\u00a0
of receiving
\u00a0
energy for
\u00a0
own usage
\u00a0
within Telenor\u2019s
\u00a0
operations,
\u00a0
they will
\u00a0
be recognised
\u00a0
as cost of
\u00a0
materials
\u00a0
and traffic
charges when effective.
NOTE 5
Salaries and personnel costs
The Group has around 14 000 full-time equivalent employees.
\u00a0
The employees have various benefits in addition to
salary, including a share-based payment program that is described
\u00a0
in this note.
\u00a0
Overview of
\u00a0
salary and personnel
\u00a0
costs
NOK in millions
2022
2021
Salaries
\u00a0
and holiday
\u00a0
pay
(8 753)
(8 688)
( 924)
( 910)
Pension costs
\u00a0
including
\u00a0
social security
\u00a0
tax (note
\u00a0
21)
(1 004)
(1 039)
Share-based
\u00a0
payments
( 116)
( 131)
Other personnel
\u00a0
costs
( 468)
( 466)
Own work capitalised
1 268
1 219
Total salaries and personnel costs
(9 998)
(10 014)
1)
Include expenses related to the Group's employee share
\u00a0
programme, and the Group's long term incentive
\u00a0
programme for managers and key personnel
\u00a0
(please
refer to note 37 as well as chapter 11 of the Corporate
\u00a0
Governance section of the Board of Directors\u2019
\u00a0
report).
The average number of labour-years employed in continuing
\u00a0
operations was approximately 14 000 in 2022 and 15 000
\u00a0
in 2021.
\u00a0
Share-based payment program
Employees
\u00a0
and managers
\u00a0
worldwide
\u00a0
are offered
\u00a0
to purchase
\u00a0
Telenor shares
\u00a0
at a discounted
\u00a0
price and
\u00a0
potentially
\u00a0
earn bonus
\u00a0
shares if
\u00a0
the share
price exceeds certain benchmarks in the future.
\u00a0
Bonus shares are awarded net after tax
\u00a0
and Telenor withhold and pay withholding taxes on behalf
of the employee. The share-based payment programs including
\u00a0
the withholding tax are considered as equity-settled share-based
\u00a0
payments, where
the fair
\u00a0
value of
\u00a0
the bonus
\u00a0
shares is
\u00a0
estimated
\u00a0
at the grant
\u00a0
date and
\u00a0
expensed
\u00a0
over the
\u00a0
vesting period.
\u00a0
Social security
\u00a0
taxes are
\u00a0
recognised
\u00a0
as
cash-settled share-based payments measured at fair value
\u00a0
and remeasured at each reporting date.
NOTE 5
Salaries and personnel costs
The Group has around 14 000 full-time equivalent employees.
\u00a0
The employees have various benefits in addition to
salary, including a share-based payment program that is described
\u00a0
in this note.
\u00a0
Overview of
\u00a0
salary and personnel
\u00a0
costs
NOK in millions
2022
2021
Salaries
\u00a0
and holiday
\u00a0
pay
(8 753)
(8 688)
( 924)
( 910)
Pension costs
\u00a0
including
\u00a0
social security
\u00a0
tax (note
\u00a0
21)
(1 004)
(1 039)
Share-based
\u00a0
payments
( 116)
( 131)
Other personnel
\u00a0
costs
( 468)
( 466)
Own work capitalised
1 268
1 219
Total salaries and personnel costs
(9 998)
(10 014)
1)
Include expenses related to the Group's employee share
\u00a0
programme, and the Group's long term incentive
\u00a0
programme for managers and key personnel
\u00a0
(please
refer to note 37 as well as chapter 11 of the Corporate
\u00a0
Governance section of the Board of Directors\u2019
\u00a0
report).
The average number of labour-years employed in continuing
\u00a0
operations was approximately 14 000 in 2022 and 15 000
\u00a0
in 2021.
\u00a0
Share-based payment program
Employees
\u00a0
and managers
\u00a0
worldwide
\u00a0
are offered
\u00a0
to purchase
\u00a0
Telenor shares
\u00a0
at a discounted
\u00a0
price and
\u00a0
potentially
\u00a0
earn bonus
\u00a0
shares if
\u00a0
the share
price exceeds certain benchmarks in the future.
\u00a0
Bonus shares are awarded net after tax
\u00a0
and Telenor withhold and pay withholding taxes on behalf
of the employee. The share-based payment programs including
\u00a0
the withholding tax are considered as equity-settled share-based
\u00a0
payments, where
the fair
\u00a0
value of
\u00a0
the bonus
\u00a0
shares is
\u00a0
estimated
\u00a0
at the grant
\u00a0
date and
\u00a0
expensed
\u00a0
over the
\u00a0
vesting period.
\u00a0
Social security
\u00a0
taxes are
\u00a0
recognised
\u00a0
as
cash-settled share-based payments measured at fair value
\u00a0
and remeasured at each reporting date.
NOTE 5
Salaries and personnel costs
The Group has around 14 000 full-time equivalent employees.
\u00a0
The employees have various benefits in addition to
salary, including a share-based payment program that is described
\u00a0
in this note.
\u00a0
Overview of
\u00a0
salary and personnel
\u00a0
costs
NOK in millions
2022
2021
Salaries
\u00a0
and holiday
\u00a0
pay
(8 753)
(8 688)
( 924)
( 910)
Pension costs
\u00a0
including
\u00a0
social security
\u00a0
tax (note
\u00a0
21)
(1 004)
(1 039)
Share-based
\u00a0
payments
( 116)
( 131)
Other personnel
\u00a0
costs
( 468)
( 466)
Own work capitalised
1 268
1 219
Total salaries and personnel costs
(9 998)
(10 014)
1)
Include expenses related to the Group's employee share
\u00a0
programme, and the Group's long term incentive
\u00a0
programme for managers and key personnel
\u00a0
(please
refer to note 37 as well as chapter 11 of the Corporate
\u00a0
Governance section of the Board of Directors\u2019
\u00a0
report).
The average number of labour-years employed in continuing
\u00a0
operations was approximately 14 000 in 2022 and 15 000
\u00a0
in 2021.
\u00a0
Share-based payment program
Employees
\u00a0
and managers
\u00a0
worldwide
\u00a0
are offered
\u00a0
to purchase
\u00a0
Telenor shares
\u00a0
at a discounted
\u00a0
price and
\u00a0
potentially
\u00a0
earn bonus
\u00a0
shares if
\u00a0
the share
price exceeds certain benchmarks in the future.
\u00a0
Bonus shares are awarded net after tax
\u00a0
and Telenor withhold and pay withholding taxes on behalf
of the employee. The share-based payment programs including
\u00a0
the withholding tax are considered as equity-settled share-based
\u00a0
payments, where
the fair
\u00a0
value of
\u00a0
the bonus
\u00a0
shares is
\u00a0
estimated
\u00a0
at the grant
\u00a0
date and
\u00a0
expensed
\u00a0
over the
\u00a0
vesting period.
\u00a0
Social security
\u00a0
taxes are
\u00a0
recognised
\u00a0
as
cash-settled share-based payments measured at fair value
\u00a0
and remeasured at each reporting date.
NOTE 5
Salaries and personnel costs
The Group has around 14 000 full-time equivalent employees.
\u00a0
The employees have various benefits in addition to
salary, including a share-based payment program that is described
\u00a0
in this note.
\u00a0
Overview of
\u00a0
salary and personnel
\u00a0
costs
NOK in millions
2022
2021
Salaries
\u00a0
and holiday
\u00a0
pay
(8 753)
(8 688)
( 924)
( 910)
Pension costs
\u00a0
including
\u00a0
social security
\u00a0
tax (note
\u00a0
21)
(1 004)
(1 039)
Share-based
\u00a0
payments
( 116)
( 131)
Other personnel
\u00a0
costs
( 468)
( 466)
Own work capitalised
1 268
1 219
Total salaries and personnel costs
(9 998)
(10 014)
1)
Include expenses related to the Group's employee share
\u00a0
programme, and the Group's long term incentive
\u00a0
programme for managers and key personnel
\u00a0
(please
refer to note 37 as well as chapter 11 of the Corporate
\u00a0
Governance section of the Board of Directors\u2019
\u00a0
report).
The average number of labour-years employed in continuing
\u00a0
operations was approximately 14 000 in 2022 and 15 000
\u00a0
in 2021.
\u00a0
Share-based payment program
Employees
\u00a0
and managers
\u00a0
worldwide
\u00a0
are offered
\u00a0
to purchase
\u00a0
Telenor shares
\u00a0
at a discounted
\u00a0
price and
\u00a0
potentially
\u00a0
earn bonus
\u00a0
shares if
\u00a0
the share
price exceeds certain benchmarks in the future.
\u00a0
Bonus shares are awarded net after tax
\u00a0
and Telenor withhold and pay withholding taxes on behalf
of the employee. The share-based payment programs including
\u00a0
the withholding tax are considered as equity-settled share-based
\u00a0
payments, where
the fair
\u00a0
value of
\u00a0
the bonus
\u00a0
shares is
\u00a0
estimated
\u00a0
at the grant
\u00a0
date and
\u00a0
expensed
\u00a0
over the
\u00a0
vesting period.
\u00a0
Social security
\u00a0
taxes are
\u00a0
recognised
\u00a0
as
cash-settled share-based payments measured at fair value
\u00a0
and remeasured at each reporting date.
NOTE 6
Other operating expenses
Other operating
\u00a0
expenses
NOK in millions
2022
2021
Other cost of premises, vehicles, office equipment
\u00a0
etc.
(2 668)
(2 196)
Operation
\u00a0
and maintenance
(5 574)
(5 470)
Marketing
\u00a0
and sales
\u00a0
commission
(4 629)
(4 394)
Advertising
(1 530)
(1 598)
External personnel and consultancy fees
(1 950)
(1 800)
Variable lease expenses
1)
(2 145)
(2 057)
Other
2)
(1 682)
(1 375)
Total other operating expenses
(20 178)
(18 891)
1)
See note 16 for more information.
2)
Includes expenses related to short term and low
\u00a0
value leases, see note 16 for more information.
NOTE 8
Other income and other expenses
Income and expenses not regarded as part of regular operational performance
\u00a0
are presented on a separate line as
other income and other expenses in Telenor. It includes gains and losses
\u00a0
on disposal of PPE and other non-current
assets, restructuring costs, losses from onerous contracts
\u00a0
and fines concluded in legal disputes.
\u00a0
Accounting policies
Other income and other expenses are items
\u00a0
that are not regarded as part of
\u00a0
regular operational performance. The purpose of presenting these
items on a separate line is to enable
\u00a0
comparison of profitability between periods. It includes gains
\u00a0
and losses on disposal of non-current
\u00a0
assets
such as property,
\u00a0
plant and
\u00a0
equipment
\u00a0
(PPE) and
\u00a0
intangible
\u00a0
assets. It
\u00a0
also includes
\u00a0
gains and
\u00a0
losses from
\u00a0
sale of
\u00a0
subsidiaries,
\u00a0
unless the
\u00a0
sale is
presented as discontinued operations. Restructuring costs are
\u00a0
included to the extent they qualify as
\u00a0
a restructuring in IAS 37. Costs related to
reduction
\u00a0
of personnel
\u00a0
is only included
\u00a0
when they
\u00a0
relate to
\u00a0
the time the
\u00a0
employee
\u00a0
no longer
\u00a0
render services
\u00a0
to Telenor.
\u00a0
Costs for loss
\u00a0
contracts
\u00a0
are
included when they qualify as onerous contracts
\u00a0
under IAS 37. Fines concluded in legal disputes
\u00a0
are included, whereas settlements on legal
disputes
\u00a0
are only
\u00a0
included
\u00a0
in other
\u00a0
income and
\u00a0
expense
\u00a0
when they
\u00a0
relate to
\u00a0
the business
\u00a0
as a whole
\u00a0
and are
\u00a0
non-recurring
\u00a0
in nature.
Other income
\u00a0
and other expenses
NOK in millions
2022
2021
Gains on disposals
\u00a0
of property,
\u00a0
plant and
\u00a0
equipment
\u00a0
(PPE), right-of-use
\u00a0
assets and
\u00a0
operations
1 954
144
Other
50
28
Total other income
2 004
172
Losses on
\u00a0
disposals
\u00a0
of property,
\u00a0
plant and
\u00a0
equipment
\u00a0
(PPE), right-of-use
\u00a0
assets and
\u00a0
operations
(462)
(464)
Expenses
\u00a0
for workforce
\u00a0
reductions,
\u00a0
onerous contracts
\u00a0
and other
(800)
(1 462)
Total other expenses
(1 261)
(1 926)
For the year 2022, total other income
\u00a0
consisted mainly of NOK 1.7 billion gain
\u00a0
on divestment of fixed non-core assets and
\u00a0
NOK 95 million related to
gain on sale of licenses in Telenor Sweden.
\u00a0
Total other expenses consisted mainly of workforce
\u00a0
reductions (of which NOK 392 million in Telenor
Norway and NOK 180 million in Grameenphone)
\u00a0
and NOK 150 million damaged fixed assets
\u00a0
in a fire in dtac.
In 2021,
\u00a0
total other
\u00a0
expenses
\u00a0
consisted
\u00a0
mainly of
\u00a0
a fine from
\u00a0
the Norwegian
\u00a0
Competition
\u00a0
Authority
\u00a0
(NOK 788
\u00a0
million),
\u00a0
losses on termination
\u00a0
of
leases in
\u00a0
dtac (NOK
\u00a0
138 million)
\u00a0
and workforce
\u00a0
reductions
\u00a0
(of which
\u00a0
NOK 338 million
\u00a0
in Grameenphone
\u00a0
and NOK 168
\u00a0
million in
\u00a0
Telenor Norway).
NOTE 7
Research and development costs
The research and development activities in Telenor mainly relate
\u00a0
to developing new services and products,
development of networks,
\u00a0
Artificial Intelligence (AI) and advanced analytics, safeguarding
\u00a0
of personal data and
cyber security. All research and development costs in Telenor are
\u00a0
expensed as they do not meet the requirements
in IFRS for capitalisation.
Accounting policies
Development expenditures
\u00a0
are capitalised only when the criteria for
\u00a0
recognition are met, i.e. that it is probable
\u00a0
that the expected future economic
benefits that are attributable to the asset
\u00a0
will flow to the entity, management has
\u00a0
committed itself to complete the asset, the
\u00a0
technical feasibility of
completing the asset has been demonstrated and
\u00a0
the cost can be measured reliably. The assets
\u00a0
are amortised over their expected useful life
\u00a0
once
the assets
\u00a0
are available
\u00a0
for use.
\u00a0
Costs incurred
\u00a0
during the
\u00a0
research
\u00a0
stage of
\u00a0
a project,
\u00a0
as well
\u00a0
as maintenance
\u00a0
and training
\u00a0
costs are
\u00a0
expensed
\u00a0
as
incurred.
\u00a0
Development
\u00a0
costs that
\u00a0
do not meet
\u00a0
the criteria
\u00a0
for capitalisation
\u00a0
are expensed
\u00a0
as incurred.
Research and
\u00a0
development costs
Research and development costs that have
\u00a0
been recognised in the income statement amount
\u00a0
to NOK 177 million in 2022 (NOK 187
\u00a0
million in 2021).
Expensed research and development activities mainly related
\u00a0
to new technologies, 5G projects, security awareness
\u00a0
and network optimisation.
Government grants are recognised when there is
\u00a0
reasonable assurance
that the grant
\u00a0
will be
\u00a0
received.
\u00a0
Grants that
\u00a0
relate to
\u00a0
expenses
\u00a0
are
normally recognised as a reduction of the
\u00a0
expense over the related
period.
\u00a0
Grants that relate to assets
\u00a0
are deducted from the carrying
amount of the asset and result in
\u00a0
lower depreciation over the useful life
of the asset.
Accounting policies
Development expenditures
\u00a0
are capitalised only when the criteria for
\u00a0
recognition are met, i.e. that it is probable
\u00a0
that the expected future economic
benefits that are attributable to the asset
\u00a0
will flow to the entity, management has
\u00a0
committed itself to complete the asset, the
\u00a0
technical feasibility of
completing the asset has been demonstrated and
\u00a0
the cost can be measured reliably. The assets
\u00a0
are amortised over their expected useful life
\u00a0
once
the assets
\u00a0
are available
\u00a0
for use.
\u00a0
Costs incurred
\u00a0
during the
\u00a0
research
\u00a0
stage of
\u00a0
a project,
\u00a0
as well
\u00a0
as maintenance
\u00a0
and training
\u00a0
costs are
\u00a0
expensed
\u00a0
as
incurred.
\u00a0
Development
\u00a0
costs that
\u00a0
do not meet
\u00a0
the criteria
\u00a0
for capitalisation
\u00a0
are expensed
\u00a0
as incurred.
NOTE 8
Other income and other expenses
Income and expenses not regarded as part of regular operational performance
\u00a0
are presented on a separate line as
other income and other expenses in Telenor. It includes gains and losses
\u00a0
on disposal of PPE and other non-current
assets, restructuring costs, losses from onerous contracts
\u00a0
and fines concluded in legal disputes.
\u00a0
Accounting policies
Other income and other expenses are items
\u00a0
that are not regarded as part of
\u00a0
regular operational performance. The purpose of presenting these
items on a separate line is to enable
\u00a0
comparison of profitability between periods. It includes gains
\u00a0
and losses on disposal of non-current
\u00a0
assets
such as property,
\u00a0
plant and
\u00a0
equipment
\u00a0
(PPE) and
\u00a0
intangible
\u00a0
assets. It
\u00a0
also includes
\u00a0
gains and
\u00a0
losses from
\u00a0
sale of
\u00a0
subsidiaries,
\u00a0
unless the
\u00a0
sale is
presented as discontinued operations. Restructuring costs are
\u00a0
included to the extent they qualify as
\u00a0
a restructuring in IAS 37. Costs related to
reduction
\u00a0
of personnel
\u00a0
is only included
\u00a0
when they
\u00a0
relate to
\u00a0
the time the
\u00a0
employee
\u00a0
no longer
\u00a0
render services
\u00a0
to Telenor.
\u00a0
Costs for loss
\u00a0
contracts
\u00a0
are
included when they qualify as onerous contracts
\u00a0
under IAS 37. Fines concluded in legal disputes
\u00a0
are included, whereas settlements on legal
disputes
\u00a0
are only
\u00a0
included
\u00a0
in other
\u00a0
income and
\u00a0
expense
\u00a0
when they
\u00a0
relate to
\u00a0
the business
\u00a0
as a whole
\u00a0
and are
\u00a0
non-recurring
\u00a0
in nature.
Other income
\u00a0
and other expenses
NOK in millions
2022
2021
Gains on disposals
\u00a0
of property,
\u00a0
plant and
\u00a0
equipment
\u00a0
(PPE), right-of-use
\u00a0
assets and
\u00a0
operations
1 954
144
Other
50
28
Total other income
2 004
172
Losses on
\u00a0
disposals
\u00a0
of property,
\u00a0
plant and
\u00a0
equipment
\u00a0
(PPE), right-of-use
\u00a0
assets and
\u00a0
operations
(462)
(464)
Expenses
\u00a0
for workforce
\u00a0
reductions,
\u00a0
onerous contracts
\u00a0
and other
(800)
(1 462)
Total other expenses
(1 261)
(1 926)
For the year 2022, total other income
\u00a0
consisted mainly of NOK 1.7 billion gain
\u00a0
on divestment of fixed non-core assets and
\u00a0
NOK 95 million related to
gain on sale of licenses in Telenor Sweden.
\u00a0
Total other expenses consisted mainly of workforce
\u00a0
reductions (of which NOK 392 million in Telenor
Norway and NOK 180 million in Grameenphone)
\u00a0
and NOK 150 million damaged fixed assets
\u00a0
in a fire in dtac.
In 2021,
\u00a0
total other
\u00a0
expenses
\u00a0
consisted
\u00a0
mainly of
\u00a0
a fine from
\u00a0
the Norwegian
\u00a0
Competition
\u00a0
Authority
\u00a0
(NOK 788
\u00a0
million),
\u00a0
losses on termination
\u00a0
of
leases in
\u00a0
dtac (NOK
\u00a0
138 million)
\u00a0
and workforce
\u00a0
reductions
\u00a0
(of which
\u00a0
NOK 338 million
\u00a0
in Grameenphone
\u00a0
and NOK 168
\u00a0
million in
\u00a0
Telenor Norway).
NOTE 8
Other income and other expenses
Income and expenses not regarded as part of regular operational performance
\u00a0
are presented on a separate line as
other income and other expenses in Telenor. It includes gains and losses
\u00a0
on disposal of PPE and other non-current
assets, restructuring costs, losses from onerous contracts
\u00a0
and fines concluded in legal disputes.
\u00a0
Accounting policies
Other income and other expenses are items
\u00a0
that are not regarded as part of
\u00a0
regular operational performance. The purpose of presenting these
items on a separate line is to enable
\u00a0
comparison of profitability between periods. It includes gains
\u00a0
and losses on disposal of non-current
\u00a0
assets
such as property,
\u00a0
plant and
\u00a0
equipment
\u00a0
(PPE) and
\u00a0
intangible
\u00a0
assets. It
\u00a0
also includes
\u00a0
gains and
\u00a0
losses from
\u00a0
sale of
\u00a0
subsidiaries,
\u00a0
unless the
\u00a0
sale is
presented as discontinued operations. Restructuring costs are
\u00a0
included to the extent they qualify as
\u00a0
a restructuring in IAS 37. Costs related to
reduction
\u00a0
of personnel
\u00a0
is only included
\u00a0
when they
\u00a0
relate to
\u00a0
the time the
\u00a0
employee
\u00a0
no longer
\u00a0
render services
\u00a0
to Telenor.
\u00a0
Costs for loss
\u00a0
contracts
\u00a0
are
included when they qualify as onerous contracts
\u00a0
under IAS 37. Fines concluded in legal disputes
\u00a0
are included, whereas settlements on legal
disputes
\u00a0
are only
\u00a0
included
\u00a0
in other
\u00a0
income and
\u00a0
expense
\u00a0
when they
\u00a0
relate to
\u00a0
the business
\u00a0
as a whole
\u00a0
and are
\u00a0
non-recurring
\u00a0
in nature.
Other income
\u00a0
and other expenses
NOK in millions
2022
2021
Gains on disposals
\u00a0
of property,
\u00a0
plant and
\u00a0
equipment
\u00a0
(PPE), right-of-use
\u00a0
assets and
\u00a0
operations
1 954
144
Other
50
28
Total other income
2 004
172
Losses on
\u00a0
disposals
\u00a0
of property,
\u00a0
plant and
\u00a0
equipment
\u00a0
(PPE), right-of-use
\u00a0
assets and
\u00a0
operations
(462)
(464)
Expenses
\u00a0
for workforce
\u00a0
reductions,
\u00a0
onerous contracts
\u00a0
and other
(800)
(1 462)
Total other expenses
(1 261)
(1 926)
For the year 2022, total other income
\u00a0
consisted mainly of NOK 1.7 billion gain
\u00a0
on divestment of fixed non-core assets and
\u00a0
NOK 95 million related to
gain on sale of licenses in Telenor Sweden.
\u00a0
Total other expenses consisted mainly of workforce
\u00a0
reductions (of which NOK 392 million in Telenor
Norway and NOK 180 million in Grameenphone)
\u00a0
and NOK 150 million damaged fixed assets
\u00a0
in a fire in dtac.
In 2021,
\u00a0
total other
\u00a0
expenses
\u00a0
consisted
\u00a0
mainly of
\u00a0
a fine from
\u00a0
the Norwegian
\u00a0
Competition
\u00a0
Authority
\u00a0
(NOK 788
\u00a0
million),
\u00a0
losses on termination
\u00a0
of
leases in
\u00a0
dtac (NOK
\u00a0
138 million)
\u00a0
and workforce
\u00a0
reductions
\u00a0
(of which
\u00a0
NOK 338 million
\u00a0
in Grameenphone
\u00a0
and NOK 168
\u00a0
million in
\u00a0
Telenor Norway).
NOTE 9
Financial income and expenses
Financial income in Telenor includes interest income on cash
\u00a0
and cash equivalents as well as customer credit. The
interest expenses mainly relate to bonds,
\u00a0
derivatives, and other borrowings in addition to lease liabilities.
\u00a0
Other
financial items include foreign currency gains and losses and
\u00a0
change in fair value of hedging instruments and
hedged items.
Accounting policies
Interest expenses related
\u00a0
to bonds,
\u00a0
commercial papers, bank loans and bank overdrafts are
\u00a0
recognised at amortised
\u00a0
cost using the effective
interest-rate method.
\u00a0
Foreign currency gains and losses arise from
\u00a0
monetary assets and liabilities denominated in foreign
\u00a0
currencies translated to
the functional currency. All exchange differences are
\u00a0
recognised in the income statement except exchange differences
\u00a0
on foreign currency
borrowings and monetary items that provide an
\u00a0
effective hedge against a net investment in
\u00a0
a foreign entity.
\u00a0
These gains and losses are recognised
in other comprehensive income until the disposal
\u00a0
of the net investment or settlement of
\u00a0
the monetary item, at which time they
\u00a0
are recognised in
the income statement. Dividend income from investments is
\u00a0
recognised when the Group\u2019s rights to receive
\u00a0
payment have been established
(declared by the General Meeting or otherwise) and
\u00a0
classified as financial income.
Financial income
\u00a0
and expenses
NOK in millions
2022
2021
Interest income
\u00a0
on cash and
\u00a0
cash equivalents
290
279
Other financial
\u00a0
income
162
137
Total financial
\u00a0
income
452
417
Interest expenses on financial liabilities
1)
(2 640)
(2 485)
Other financial
\u00a0
expenses
(1 132)
( 498)
Total financial expenses
(3 772)
(2 983)
Foreign currency gains
1 644
2 451
Foreign
\u00a0
currency
\u00a0
losses
(5 028)
(3 521)
Net foreign currency gains (losses)
(3 384)
(1 070)
Net change
\u00a0
in fair
\u00a0
value of
\u00a0
financial
\u00a0
instruments
\u00a0
at fair
\u00a0
value through
\u00a0
profit or
\u00a0
loss
592
201
Net change in fair value of hedging
\u00a0
instruments and hedged items
( 200)
( 44)
Net gains (losses and impairment) on financial assets
\u00a0
and liabilities
1
7
Other changes
393
165
Net financial
\u00a0
income (expenses)
(6 312)
(3 472)
4)
Includes interest expenses on lease liabilities, see note
\u00a0
16 for more information.
In 2022,
\u00a0
interest expenses
\u00a0
related to
\u00a0
interest-bearing
\u00a0
debt amounts
\u00a0
to NOK 1.6
\u00a0
billion,
\u00a0
an increase
\u00a0
of NOK 0.1
\u00a0
billion compared
\u00a0
to 2021.
\u00a0
This increase
is mainly explained by higher interest rates. Further, interest expenses
\u00a0
on lease liabilities amounts to NOK 1.1
\u00a0
billion in 2022 and 2021. Other financial
expenses for 2022 includes provision for regulatory
\u00a0
disputes in Bangladesh.
Net foreign currency losses were NOK 3.4
\u00a0
billion in 2022, compared to losses of NOK
\u00a0
1.1 billion in 2021. The net foreign currency
\u00a0
losses in 2022 was
mainly related to translation of debt denominated
\u00a0
in USD used for economic hedges of
\u00a0
assets, USD liabilities in Pakistan as well as
\u00a0
internal loans in
SGD within
\u00a0
Telenor
\u00a0
Group. The
\u00a0
net foreign
\u00a0
currency
\u00a0
losses in
\u00a0
2021 was
\u00a0
mainly related
\u00a0
to translation
\u00a0
of debt
\u00a0
denominated
\u00a0
in USD used
\u00a0
for economic
hedges of assets and USD liabilities in
\u00a0
Pakistan.
NOTE 9
Financial income and expenses
Financial income in Telenor includes interest income on cash
\u00a0
and cash equivalents as well as customer credit. The
interest expenses mainly relate to bonds,
\u00a0
derivatives, and other borrowings in addition to lease liabilities.
\u00a0
Other
financial items include foreign currency gains and losses and
\u00a0
change in fair value of hedging instruments and
hedged items.
Accounting policies
Interest expenses related
\u00a0
to bonds,
\u00a0
commercial papers, bank loans and bank overdrafts are
\u00a0
recognised at amortised
\u00a0
cost using the effective
interest-rate method.
\u00a0
Foreign currency gains and losses arise from
\u00a0
monetary assets and liabilities denominated in foreign
\u00a0
currencies translated to
the functional currency. All exchange differences are
\u00a0
recognised in the income statement except exchange differences
\u00a0
on foreign currency
borrowings and monetary items that provide an
\u00a0
effective hedge against a net investment in
\u00a0
a foreign entity.
\u00a0
These gains and losses are recognised
in other comprehensive income until the disposal
\u00a0
of the net investment or settlement of
\u00a0
the monetary item, at which time they
\u00a0
are recognised in
the income statement. Dividend income from investments is
\u00a0
recognised when the Group\u2019s rights to receive
\u00a0
payment have been established
(declared by the General Meeting or otherwise) and
\u00a0
classified as financial income.
Financial income
\u00a0
and expenses
NOK in millions
2022
2021
Interest income
\u00a0
on cash and
\u00a0
cash equivalents
290
279
Other financial
\u00a0
income
162
137
Total financial
\u00a0
income
452
417
Interest expenses on financial liabilities
1)
(2 640)
(2 485)
Other financial
\u00a0
expenses
(1 132)
( 498)
Total financial expenses
(3 772)
(2 983)
Foreign currency gains
1 644
2 451
Foreign
\u00a0
currency
\u00a0
losses
(5 028)
(3 521)
Net foreign currency gains (losses)
(3 384)
(1 070)
Net change
\u00a0
in fair
\u00a0
value of
\u00a0
financial
\u00a0
instruments
\u00a0
at fair
\u00a0
value through
\u00a0
profit or
\u00a0
loss
592
201
Net change in fair value of hedging
\u00a0
instruments and hedged items
( 200)
( 44)
Net gains (losses and impairment) on financial assets
\u00a0
and liabilities
1
7
Other changes
393
165
Net financial
\u00a0
income (expenses)
(6 312)
(3 472)
4)
Includes interest expenses on lease liabilities, see note
\u00a0
16 for more information.
In 2022,
\u00a0
interest expenses
\u00a0
related to
\u00a0
interest-bearing
\u00a0
debt amounts
\u00a0
to NOK 1.6
\u00a0
billion,
\u00a0
an increase
\u00a0
of NOK 0.1
\u00a0
billion compared
\u00a0
to 2021.
\u00a0
This increase
is mainly explained by higher interest rates. Further, interest expenses
\u00a0
on lease liabilities amounts to NOK 1.1
\u00a0
billion in 2022 and 2021. Other financial
expenses for 2022 includes provision for regulatory
\u00a0
disputes in Bangladesh.
Net foreign currency losses were NOK 3.4
\u00a0
billion in 2022, compared to losses of NOK
\u00a0
1.1 billion in 2021. The net foreign currency
\u00a0
losses in 2022 was
mainly related to translation of debt denominated
\u00a0
in USD used for economic hedges of
\u00a0
assets, USD liabilities in Pakistan as well as
\u00a0
internal loans in
SGD within
\u00a0
Telenor
\u00a0
Group. The
\u00a0
net foreign
\u00a0
currency
\u00a0
losses in
\u00a0
2021 was
\u00a0
mainly related
\u00a0
to translation
\u00a0
of debt
\u00a0
denominated
\u00a0
in USD used
\u00a0
for economic
hedges of assets and USD liabilities in
\u00a0
Pakistan.
NOTE 9
Financial income and expenses
Financial income in Telenor includes interest income on cash
\u00a0
and cash equivalents as well as customer credit. The
interest expenses mainly relate to bonds,
\u00a0
derivatives, and other borrowings in addition to lease liabilities.
\u00a0
Other
financial items include foreign currency gains and losses and
\u00a0
change in fair value of hedging instruments and
hedged items.
Accounting policies
Interest expenses related
\u00a0
to bonds,
\u00a0
commercial papers, bank loans and bank overdrafts are
\u00a0
recognised at amortised
\u00a0
cost using the effective
interest-rate method.
\u00a0
Foreign currency gains and losses arise from
\u00a0
monetary assets and liabilities denominated in foreign
\u00a0
currencies translated to
the functional currency. All exchange differences are
\u00a0
recognised in the income statement except exchange differences
\u00a0
on foreign currency
borrowings and monetary items that provide an
\u00a0
effective hedge against a net investment in
\u00a0
a foreign entity.
\u00a0
These gains and losses are recognised
in other comprehensive income until the disposal
\u00a0
of the net investment or settlement of
\u00a0
the monetary item, at which time they
\u00a0
are recognised in
the income statement. Dividend income from investments is
\u00a0
recognised when the Group\u2019s rights to receive
\u00a0
payment have been established
(declared by the General Meeting or otherwise) and
\u00a0
classified as financial income.
Financial income
\u00a0
and expenses
NOK in millions
2022
2021
Interest income
\u00a0
on cash and
\u00a0
cash equivalents
290
279
Other financial
\u00a0
income
162
137
Total financial
\u00a0
income
452
417
Interest expenses on financial liabilities
1)
(2 640)
(2 485)
Other financial
\u00a0
expenses
(1 132)
( 498)
Total financial expenses
(3 772)
(2 983)
Foreign currency gains
1 644
2 451
Foreign
\u00a0
currency
\u00a0
losses
(5 028)
(3 521)
Net foreign currency gains (losses)
(3 384)
(1 070)
Net change
\u00a0
in fair
\u00a0
value of
\u00a0
financial
\u00a0
instruments
\u00a0
at fair
\u00a0
value through
\u00a0
profit or
\u00a0
loss
592
201
Net change in fair value of hedging
\u00a0
instruments and hedged items
( 200)
( 44)
Net gains (losses and impairment) on financial assets
\u00a0
and liabilities
1
7
Other changes
393
165
Net financial
\u00a0
income (expenses)
(6 312)
(3 472)
4)
Includes interest expenses on lease liabilities, see note
\u00a0
16 for more information.
In 2022,
\u00a0
interest expenses
\u00a0
related to
\u00a0
interest-bearing
\u00a0
debt amounts
\u00a0
to NOK 1.6
\u00a0
billion,
\u00a0
an increase
\u00a0
of NOK 0.1
\u00a0
billion compared
\u00a0
to 2021.
\u00a0
This increase
is mainly explained by higher interest rates. Further, interest expenses
\u00a0
on lease liabilities amounts to NOK 1.1
\u00a0
billion in 2022 and 2021. Other financial
expenses for 2022 includes provision for regulatory
\u00a0
disputes in Bangladesh.
Net foreign currency losses were NOK 3.4
\u00a0
billion in 2022, compared to losses of NOK
\u00a0
1.1 billion in 2021. The net foreign currency
\u00a0
losses in 2022 was
mainly related to translation of debt denominated
\u00a0
in USD used for economic hedges of
\u00a0
assets, USD liabilities in Pakistan as well as
\u00a0
internal loans in
SGD within
\u00a0
Telenor
\u00a0
Group. The
\u00a0
net foreign
\u00a0
currency
\u00a0
losses in
\u00a0
2021 was
\u00a0
mainly related
\u00a0
to translation
\u00a0
of debt
\u00a0
denominated
\u00a0
in USD used
\u00a0
for economic
hedges of assets and USD liabilities in
\u00a0
Pakistan.
Accounting policies
Interest expenses related
\u00a0
to bonds,
\u00a0
commercial papers, bank loans and bank overdrafts are
\u00a0
recognised at amortised
\u00a0
cost using the effective
interest-rate method.
\u00a0
Foreign currency gains and losses arise from
\u00a0
monetary assets and liabilities denominated in foreign
\u00a0
currencies translated to
the functional currency. All exchange differences are
\u00a0
recognised in the income statement except exchange differences
\u00a0
on foreign currency
borrowings and monetary items that provide an
\u00a0
effective hedge against a net investment in
\u00a0
a foreign entity.
\u00a0
These gains and losses are recognised
in other comprehensive income until the disposal
\u00a0
of the net investment or settlement of
\u00a0
the monetary item, at which time they
\u00a0
are recognised in
the income statement. Dividend income from investments is
\u00a0
recognised when the Group\u2019s rights to receive
\u00a0
payment have been established
(declared by the General Meeting or otherwise) and
\u00a0
classified as financial income.
Interest expenses related
\u00a0
to bonds,
\u00a0
commercial papers, bank loans and bank overdrafts are
\u00a0
recognised at amortised
\u00a0
cost using the effective
interest-rate method.
\u00a0
Foreign currency gains and losses arise from
\u00a0
monetary assets and liabilities denominated in foreign
\u00a0
currencies translated to
the functional currency. All exchange differences are
\u00a0
recognised in the income statement except exchange differences
\u00a0
on foreign currency
borrowings and monetary items that provide an
\u00a0
effective hedge against a net investment in
\u00a0
a foreign entity.
\u00a0
These gains and losses are recognised
in other comprehensive income until the disposal
\u00a0
of the net investment or settlement of
\u00a0
the monetary item, at which time they
\u00a0
are recognised in
the income statement. Dividend income from investments is
\u00a0
recognised when the Group\u2019s rights to receive
\u00a0
payment have been established
(declared by the General Meeting or otherwise) and
\u00a0
classified as financial income.
NOTE 10
Income taxes
Telenor is in a payable tax position in most jurisdictions. Nevertheless,
\u00a0
Telenor had a net tax income in 2022 of
27.1% as a result of favourable development in a tax dispute in Norway
\u00a0
and realisation of tax losses from
restructuring of shareholdings in Asia. Telenor is involved
\u00a0
in several legal proceedings and discussions related to
its tax position where the outcome is uncertain. Uncertain tax positions
\u00a0
may require significant judgment including
assessment of future taxable profits and estimating the outcome
\u00a0
of significant tax disputes.
\u00a0
Accounting policies
Telenor bases its assessment of taxable income
\u00a0
on interpretation of relevant laws and regulations,
\u00a0
and when it is considered as probable that the
tax treatment
\u00a0
will be
\u00a0
sustained
\u00a0
in a tax
\u00a0
review. Current
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are measured
\u00a0
at the amount
\u00a0
expected
\u00a0
to be recovered
\u00a0
or paid
\u00a0
to
the tax authorities.
\u00a0
Deferred
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are calculated
\u00a0
using the
\u00a0
liability
\u00a0
method where
\u00a0
deferred
\u00a0
taxes are
\u00a0
recognised
\u00a0
on the
difference between the tax base and the
\u00a0
carrying amount of the assets and liabilities,
\u00a0
including tax losses carried forward. Deferred tax assets and
liabilities
\u00a0
are not recognised
\u00a0
on goodwill
\u00a0
or on investments
\u00a0
in subsidiaries,
\u00a0
associates,
\u00a0
or joint
\u00a0
ventures
\u00a0
where the
\u00a0
timing of
\u00a0
the reversal
\u00a0
can be
controlled,
\u00a0
and it is
\u00a0
probable
\u00a0
that the temporary
\u00a0
difference
\u00a0
will not be
\u00a0
reversed
\u00a0
in the foreseeable
\u00a0
future. Deferred
\u00a0
tax assets
\u00a0
are only
\u00a0
recognised
\u00a0
to
the extent
\u00a0
it is more
\u00a0
likely than
\u00a0
not that the
\u00a0
tax assets
\u00a0
will be
\u00a0
utilised.
\u00a0
Deferred
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are offset
\u00a0
when there
\u00a0
is a legally
\u00a0
enforceable
right, Telenor
\u00a0
is capable
\u00a0
to and intends
\u00a0
to settle
\u00a0
on a net
\u00a0
basis. The
\u00a0
enacted tax
\u00a0
rates at
\u00a0
the end of
\u00a0
the reporting
\u00a0
period and
\u00a0
undiscounted
\u00a0
amounts
are used. A change in deferred tax assets
\u00a0
and liabilities because of change in tax rates
\u00a0
is recognised in profit or loss, except when
\u00a0
it relates to items
that previously was recognised in other comprehensive income
\u00a0
or directly in equity. Deferred tax is provided for
\u00a0
undistributed earnings in
subsidiaries when distribution is expected in foreseeable future.
\u00a0
Deferred tax for undistributed earnings in associated
\u00a0
companies is provided for as
the timing
\u00a0
of the reversal
\u00a0
of the temporary
\u00a0
differences
\u00a0
cannot be
\u00a0
controlled
\u00a0
by Telenor.
Key judgments
\u00a0
and estimates
\u00a0
Significant judgements are required when assessing uncertain
\u00a0
tax assets, like tax losses carried forward. Such
\u00a0
judgment may include assessment
of taxable
\u00a0
profits in
\u00a0
futures years
\u00a0
as well
\u00a0
as tax planning
\u00a0
strategies
\u00a0
and the existence
\u00a0
of taxable
\u00a0
temporary
\u00a0
differences.
\u00a0
Entities
\u00a0
with a history
\u00a0
of
recent losses need convincing evidence that sufficient
\u00a0
future taxable profit will be generated before a tax
\u00a0
asset is recognised. Uncertainty related
to new transactions
\u00a0
and events
\u00a0
and the
\u00a0
interpretation
\u00a0
of new tax
\u00a0
rules may
\u00a0
also affect
\u00a0
these judgements.
Telenor is involved in various legal proceedings, disputes
\u00a0
and claims related to its income tax positions
\u00a0
where the outcomes is subject to significant
uncertainty. The management assessment may include interpretation
\u00a0
of relevant laws, regulations, and the outcome
\u00a0
of similar tax disputes in the
same jurisdiction, expert opinions from external tax
\u00a0
advisors and communication with the tax authorities.
\u00a0
A tax provision is recognised when an
unfavourable outcome is considered probable, and a
\u00a0
reliable estimate can be made. In Norway,
\u00a0
a formal decision made by the tax
\u00a0
authorities or
lower courts is presumed to represent the
\u00a0
best estimate for accounting purposes unless expert
\u00a0
opinions can point to errors clearly
\u00a0
indicating that
the tax assessment is incorrect. The tax
\u00a0
provision is updated whenever the assumptions change.
\u00a0
Tax disputes are disclosed in this note if they
\u00a0
are
considered
\u00a0
significant
\u00a0
for Telenor.
\u00a0
See also
\u00a0
note 23 Legal
\u00a0
Disputes
\u00a0
and contingencies.
Income tax expense
NOK in millions
2022
2021
Profit before taxes
10 732
13 723
Current taxes
( 411)
(5 864)
Deferred taxes
3 325
855
Income taxes
2 914
(5 008)
Current taxes
In 2022 current taxes are impacted mainly
\u00a0
by current tax income of NOK 3.1 billion
\u00a0
in Norway (see below reversal of tax expense
\u00a0
for the India
guarantee
\u00a0
for Unitech
\u00a0
Wireless,
\u00a0
reversal
\u00a0
of tax provision
\u00a0
in Norway
\u00a0
related
\u00a0
to losses
\u00a0
on loans and
\u00a0
guarantees,
\u00a0
and prior
\u00a0
year assessments
\u00a0
or
adjustments on current tax) and current tax
\u00a0
expense of NOK 2.3 billion in Bangladesh.
\u00a0
Current taxes in 2021 were impacted mainly by a
\u00a0
fine paid by
Telenor
\u00a0
to the Norwegian
\u00a0
Competition
\u00a0
Authority
\u00a0
(NCA)
\u00a0
for a claim
\u00a0
on an alleged
\u00a0
breach of
\u00a0
the prohibition
\u00a0
against abuse
\u00a0
of a dominant
\u00a0
position (see
comments
\u00a0
below on
\u00a0
NCA case).
In 2022 deferred taxes
are impacted mainly by NOK 2.1 billion in
\u00a0
Norway, mainly due to realisation of tax losses
\u00a0
related to an internal legal
restructuring in Asia, and
\u00a0
NOK 1.1 billion in Pakistan mainly related to
\u00a0
the impairment of fixed assts.
Effective tax
\u00a0
rate
\u00a0
The table below reconciles the reported income
\u00a0
tax expense to the expected income tax
\u00a0
expense according to the Norwegian corporate income
tax rate of 22%. It also discloses
\u00a0
the main elements of the tax expense.
\u00a0
Comments are provided on selected line items in
\u00a0
the table below.
NOK in millions
2022
2021
Income tax expense at corporate income tax
\u00a0
rate in Norway 22%
(2 361)
(3 019)
Effect of
\u00a0
tax rates
\u00a0
outside Norway
\u00a0
different
\u00a0
from 22%
( 625)
(1 135)
Effect of
\u00a0
changes in
\u00a0
tax rates
13
-
Current and deferred taxes on retained earnings
\u00a0
and dividend in subsidiaries and associated companies
( 70)
( 98)
Tax income from restructuring in Asia
3 136
Reversal of tax expense for the India
\u00a0
guarantee for Unitech Wireless
\u00a0
2 491
Divestment of fixed non-core assets in
\u00a0
Telenor Sweden
356
Reversal
\u00a0
of tax provision
\u00a0
in Norway
\u00a0
related
\u00a0
to losses on
\u00a0
loans and
\u00a0
guarantees
330
( 173)
Other items
( 594)
( 624)
Prior years
\u00a0
assessments
\u00a0
or adjustments
\u00a0
on current
\u00a0
tax
297
34
Deferred tax assets not recognised current year
( 66)
1
Change in previously not recognised deferred tax
\u00a0
assets
\u00a0
6
6
Income taxes
2 914
(5 008)
Effective
\u00a0
tax rate
\u00a0
in %
-27.1
36.5
Tax rates outside Norway different from 22%
\u00a0
Effects are mainly related to Grameenphone Ltd.
\u00a0
(Bangladesh: 40%) and Telenor Pakistan (33%) having higher
\u00a0
nominal tax rates than the nominal
tax rate for Norway. Telenor Sweden (20.6%),
\u00a0
DNA (Finland: 20%) and dtac (Thailand: 20%)
\u00a0
have lower nominal tax rates.
Effect of changes in tax rates
Pakistan enacted an increase of their corporate
\u00a0
income tax rate from 29% to 33%
\u00a0
in 2022.
Current and deferred taxes on retained earnings and dividend
\u00a0
in subsidiaries and associated companies
\u00a0
Includes current taxes on dividends received, as
\u00a0
well as change in deferred tax liability (primarily withholding tax)
\u00a0
recognised on undistributed
earnings
\u00a0
in subsidiaries
\u00a0
and associated
\u00a0
companies
\u00a0
outside of
\u00a0
Norway. Deferred
\u00a0
taxes on
\u00a0
retained
\u00a0
earnings in
\u00a0
foreign
\u00a0
subsidiaries
\u00a0
are provided
\u00a0
for
in full as of 31 December 2022 and 2021.
\u00a0
Tax income from restructuring in Asia
As a part of Telenor\u2019s new strategy,
\u00a0
an internal restructuring process has been initiated
\u00a0
to form a new Singapore holding company for
\u00a0
all Asian
mobile operations.
\u00a0
Telenor India
\u00a0
is not a part
\u00a0
of the strategy
\u00a0
for Asia
\u00a0
going forward,
\u00a0
and therefore
\u00a0
the company
\u00a0
holding
\u00a0
the interests
\u00a0
in India
\u00a0
has
been transferred from Telenor Mobile Communications AS
\u00a0
to Telenor Communications II AS. A deductible
\u00a0
tax loss of NOK 14.3 billion
\u00a0
was realised
for Norwegian purposes by the transaction. The
\u00a0
deductibility is based on an advanced binding ruling
\u00a0
from Norwegian tax authorities.
Reversal of tax expense for the India guarantee for Unitech
\u00a0
Wireless
In 2012, Telenor ASA recorded a loss after
\u00a0
having repaid, as guarantor, all Unitech Wireless\u2019 interest-bearing
\u00a0
borrowings, amounting to NOK 10.6
billion.
\u00a0
A deferred
\u00a0
tax asset
\u00a0
of NOK 2.5
\u00a0
billion was
\u00a0
recognised.
\u00a0
In 2013, the
\u00a0
business transfer
\u00a0
from Unitech
\u00a0
Wireless
\u00a0
to Telenor
\u00a0
India was
\u00a0
completed,
and Telenor
\u00a0
ASA deducted
\u00a0
NOK 9.3 billion
\u00a0
as loss on
\u00a0
guarantees
\u00a0
in its tax
\u00a0
filing.
\u00a0
In 2019, Telenor
\u00a0
ASA has received
\u00a0
a reassessment
\u00a0
order from
\u00a0
the
Norwegian tax authorities disallowing deduction for the
\u00a0
loss, which increases previous years\u2019 current income
\u00a0
tax with NOK 2.5 billion in 2019. The
decision
\u00a0
was upheld
\u00a0
by the Tax
\u00a0
Appeal Board.
\u00a0
Telenor ASA
\u00a0
has appealed
\u00a0
the decision
\u00a0
to the district
\u00a0
court. On
\u00a0
28 March
\u00a0
2022, the
\u00a0
district
\u00a0
court
decided in favour of Telenor ASA, and
\u00a0
the tax expense was reversed with NOK
\u00a0
2.5 billion in 2022. The government has appealed the
\u00a0
ruling to the
Appeal
\u00a0
Court, and
\u00a0
the appeal
\u00a0
is scheduled
\u00a0
to be heard
\u00a0
in April
\u00a0
2023.
Divestment of fixed non-core assets in Telenor Sweden
Telenor Sweden sold Open Universe and the
\u00a0
company\u2019s fibre to the home (FTTH) accesses
\u00a0
in the single dwelling unit (SDU) segment
\u00a0
to Global
Connect for
\u00a0
a total
\u00a0
consideration
\u00a0
of NOK 3
\u00a0
billion.
\u00a0
The transaction
\u00a0
generated
\u00a0
a pre-tax
\u00a0
gain on
\u00a0
disposal
\u00a0
of NOK 1.7
\u00a0
billion.
Reversal
\u00a0
of tax provision
\u00a0
in Norway
\u00a0
related to
\u00a0
losses on
\u00a0
loans and
\u00a0
guarantees.
Telenor ASA claimed deductions for losses on
\u00a0
loans and guarantees related to the subsidiary
\u00a0
Cinclus Technology AS in 2008 with NOK
\u00a0
0.5 billion
and in 2011
\u00a0
with NOK
\u00a0
0.7 billion.
\u00a0
The Tax Office
\u00a0
disallowed
\u00a0
deductions
\u00a0
for 2008
\u00a0
by decision
\u00a0
of 21 December
\u00a0
2016, and
\u00a0
for 2011 by
\u00a0
decision of
\u00a0
21
February 2018. Telenor ASA appealed the decisions. On
\u00a0
6 June 2022, the Tax Appeal Board
\u00a0
decided that Telenor ASA should be allowed
deductions,
\u00a0
and the tax
\u00a0
expense
\u00a0
was therefore
\u00a0
reversed.
Fine imposed by the Norwegian Competition Authority (NCA)
In 2021
\u00a0
Telenor paid
\u00a0
a fine of
\u00a0
NOK 0.8 billion
\u00a0
to NCA for
\u00a0
a claim
\u00a0
from 21 June
\u00a0
2018. The
\u00a0
claim relates
\u00a0
to an alleged
\u00a0
breach of
\u00a0
the prohibition
\u00a0
against
abuse of
\u00a0
a dominant
\u00a0
position related
\u00a0
to the pricing
\u00a0
model in one
\u00a0
mobile wholesale
\u00a0
agreement
\u00a0
in the mobile
\u00a0
market in
\u00a0
the period
\u00a0
2010-2014,
\u00a0
see
note 23 Legal
\u00a0
Disputes
\u00a0
and contingencies.
\u00a0
Other items
In 2022 non-deductible items are in line
\u00a0
with last year.
Prior year assessments or adjustments on current tax
In 2022 it is mainly related to reversal
\u00a0
of previous years\u2019 current income for pipes
\u00a0
and digging costs in Norway.
Tax losses carried
\u00a0
forward
Tax losses carried forward in selected countries expire
\u00a0
as follows as of 31 December 2022:
NOK in millions
Norway
Denmark
Thailand
Other
Total
2023
-
-
591
-
591
2024
-
-
999
1
1 000
2025
-
-
327
14
340
2026
-
-
516
15
531
2027
-
-
939
20
959
2028 and later
-
-
-
319
319
Not time-limited
12 484
590
379
283
13 737
Total tax
\u00a0
losses carried
\u00a0
forward
12 484
590
3 751
653
17 477
Of which
\u00a0
deferred
\u00a0
tax assets
\u00a0
have not been
\u00a0
recognised
-
154
431
542
1 127
Of which deferred tax assets have been recognised
12 484
436
3 320
111
16 350
Tax losses carried forward in selected countries expire
\u00a0
as follows as of 31 December 2021:
NOK in millions
Norway
Denmark
Thailand
Other
Total
2022
-
-
139
-
139
2023
-
-
2 063
1
2 064
2024
-
-
938
1
939
2025
-
-
305
2
307
2026
-
-
700
14
714
2027 and later
-
-
-
334
334
Not time-limited
-
735
366
242
1 344
Total tax
\u00a0
losses carried
\u00a0
forward
-
735
4 512
594
5 841
Of which
\u00a0
deferred
\u00a0
tax assets
\u00a0
have not been
\u00a0
recognised
-
146
427
485
1 059
Of which deferred tax assets have been recognised
-
589
4 085
109
4 782
In 2022, tax losses carried forward, before and
\u00a0
after valuation allowance, increased by NOK 11.6
\u00a0
billion, mainly due to recognition of NOK
\u00a0
12.5 billion
tax losses
\u00a0
carried
\u00a0
forward in
\u00a0
Norway, partly
\u00a0
offset by
\u00a0
the utilisation
\u00a0
of tax losses
\u00a0
in Denmark
\u00a0
and Thailand.
\u00a0
In 2021,
\u00a0
tax losses
\u00a0
carried
\u00a0
forward,
before and
\u00a0
after valuation
\u00a0
allowance,
\u00a0
decreased
\u00a0
by NOK 1.6
\u00a0
billion and
\u00a0
NOK 1.5 billion,
\u00a0
respectively,
\u00a0
mainly due
\u00a0
to utilisation
\u00a0
of tax losses
\u00a0
in Denmark
and Thailand.
Tax assets recognised on tax losses carried forward
Norway,
\u00a0
Thailand and Denmark have recognised tax assets on
\u00a0
unused tax losses as the Group expects there
\u00a0
will be sufficient future taxable profits
available
\u00a0
to utilise
\u00a0
these losses.
Uncertain tax
\u00a0
positions
Pakistan
Telenor Pakistan has received reassessment orders from
\u00a0
the Tax Authority concerning deductibility of certain expenses
\u00a0
in tax returns and
disputing
\u00a0
the adjustment
\u00a0
of advance
\u00a0
income tax
\u00a0
paid on import
\u00a0
of equipment
\u00a0
with a total
\u00a0
exposure of
\u00a0
NOK 2.1
\u00a0
billion.
\u00a0
Telenor Pakistan
\u00a0
is of the
opinion that
\u00a0
the deductibility
\u00a0
of these expenses
\u00a0
is in accordance
\u00a0
with the tax
\u00a0
law in Pakistan
\u00a0
(also supported
\u00a0
by external
\u00a0
legal advisors),
\u00a0
hence
Telenor
\u00a0
Pakistan
\u00a0
disagrees
\u00a0
with the reassessment
\u00a0
orders and
\u00a0
has challenged
\u00a0
the orders,
\u00a0
which are
\u00a0
pending at
\u00a0
various appellate
\u00a0
forums.
In 2012, Telenor ASA recorded a loss on
\u00a0
receivables on its Indian subsidiary Unitech Wireless
\u00a0
after having repaid, as guarantor, all Unitech Wireless\u2019
interest-bearing
\u00a0
borrowings,
\u00a0
amounting
\u00a0
to NOK 10.6
\u00a0
billion.
\u00a0
A deferred
\u00a0
tax asset
\u00a0
of NOK 2.5
\u00a0
billion was
\u00a0
recognised.
\u00a0
In 2013,
\u00a0
after the
\u00a0
business
transfer from
\u00a0
Unitech Wireless
\u00a0
to Telenor
\u00a0
India was
\u00a0
completed,
\u00a0
Telenor ASA
\u00a0
deducted
\u00a0
the actual
\u00a0
tax loss of
\u00a0
NOK 9.3
\u00a0
billion
\u00a0
in its tax
\u00a0
return. During
2017 and 2018 Telenor ASA received draft notices
\u00a0
of possible reassessment, and Telenor has disclosed
\u00a0
an uncertain tax position in its Annual
Reports since
\u00a0
2016. On
\u00a0
22 August
\u00a0
2019, Telenor
\u00a0
ASA received
\u00a0
a reassessment
\u00a0
order related
\u00a0
to income
\u00a0
year 2013,
\u00a0
disallowing
\u00a0
deduction
\u00a0
for the loss
Telenor ASA recognised in 2012. Following this
\u00a0
reassessment, Telenor ASA recognised a tax expense
\u00a0
of NOK 2.5 billion in the third quarter
\u00a0
2019 and
paid the amount on 3 October 2019.
\u00a0
Telenor ASA disagrees with the tax authorities\u2019 position
\u00a0
and appealed the reassessment. In a decision
\u00a0
received
10 February
\u00a0
2021 the Tax
\u00a0
Appeal Board
\u00a0
upheld the
\u00a0
reassessment.
\u00a0
Telenor
\u00a0
ASA appealed
\u00a0
the decision
\u00a0
to the district
\u00a0
court. On
\u00a0
28 March 2022,
\u00a0
the
district court decided in favour of Telenor ASA,
\u00a0
and the tax expense was reversed with
\u00a0
NOK 2.5 billion in 2022. The government has appealed
\u00a0
the
ruling to the Court of Appeal, and the
\u00a0
appeal is scheduled to be heard in April
\u00a0
2023.
Tax effect of
\u00a0
temporary differences
\u00a0
and tax losses
\u00a0
carried forward
\u00a0
as of 31 December
2022
2021
NOK in millions
Deferred
tax assets
Deferred tax
liabilities
Of which
deferred
not recognised
the income
statement
Deferred
tax assets
Deferred tax
liabilities
Of which
recognised
the income
statement
Tangible and intangible assets
1 791
(9 269)
( 142)
575
1 861
(11 885)
( 80)
618
Undistributed earnings in foreign subsidiaries
and associated
\u00a0
companies
-
( 207)
-
128
-
( 344)
-
106
Non-current borrowings
4 364
( 262)
-
524
4 920
( 169)
-
( 722)
Other non-current
\u00a0
items
761
( 994)
-
( 48)
1 262
(1 307)
-
121
Total non-current assets and liabilities
6 915
(10 733)
( 142)
1 180
8 043
(13 706)
( 80)
124
Total current
\u00a0
assets and
\u00a0
liabilities
2 532
( 204)
-
117
2 884
( 288)
-
955
Tax losses carried forward
3 757
-
( 229)
2 088
1 184
-
( 216)
( 241)
Valuation allowance recognised
\u00a0
in the income
\u00a0
statement
\u00a0
( 59)
17
Deferred tax recognised in the income
statement
3 325
855
Total deferred tax assets/liabilities
13 205
(10 937)
( 371)
12 111
(13 994)
( 296)
Net deferred tax assets/liabilities
-
1 897
-
-
(2 179)
-
Of which
\u00a0
deferred
\u00a0
tax assets
-
5 536
-
-
2 195
-
Of which deferred tax liabilities
-
(3 639)
-
-
(4 374)
-
For 2022,
\u00a0
total non-current
\u00a0
assets and
\u00a0
liabilities
\u00a0
decreased
\u00a0
by NOK 1.1
\u00a0
billion, and
\u00a0
NOK 3.0
\u00a0
billion respectively.
\u00a0
Out of those,
\u00a0
NOK 1.1
\u00a0
billion, and
\u00a0
NOK
2.4 billion respectively are related to the deconsolidation
\u00a0
of Digi. Total current assets decreased by NOK 0.7
\u00a0
billion for the same reason. For 2021,
the decrease
\u00a0
in deferred
\u00a0
tax assets
\u00a0
is mainly
\u00a0
related to
\u00a0
the reclassification
\u00a0
of Telenor
\u00a0
Myanmar
\u00a0
as discontinued
\u00a0
operations.
\u00a0
See also
\u00a0
note 12
\u00a0
Held
for sale and discontinued operations.
Changes in net
\u00a0
deferred tax
\u00a0
assets and liabilities
NOK in millions
2022
2021
As of 1 January
(2 179)
(1 990)
Recognised in the income statement
\u00a0
3 325
855
Recognised
\u00a0
in other
\u00a0
comprehensive
\u00a0
income
170
( 592)
Recognised directly to equity
( 11)
( 14)
Acquisitions and disposals of subsidiaries
644
9
Translation differences on deferred taxes
( 51)
64
Discontinued
\u00a0
operations
-
( 511)
As of 31 December
1 897
(2 179)
Recognised in the income statement
For 2022, the change of the amount
\u00a0
recognised in the income statement between 2022
\u00a0
and 2021 is related mainly to Norway and
\u00a0
Pakistan.
\u00a0
Recognised in other comprehensive income
For 2022,
\u00a0
the change
\u00a0
of the amount
\u00a0
recognised
\u00a0
in other
\u00a0
comprehensive
\u00a0
income between
\u00a0
2022 and
\u00a0
2021 is related
\u00a0
to losses
\u00a0
on net investment
hedges.
Acquisitions and disposals of subsidiaries
For 2022, the change of the amount
\u00a0
in acquisitions and disposals between 2022 and
\u00a0
2021 is related to the deconsolidation of Digi,
\u00a0
see note 12 Held
for sale
\u00a0
and discontinued
\u00a0
operations.
NOTE 10
Income taxes
Telenor is in a payable tax position in most jurisdictions. Nevertheless,
\u00a0
Telenor had a net tax income in 2022 of
27.1% as a result of favourable development in a tax dispute in Norway
\u00a0
and realisation of tax losses from
restructuring of shareholdings in Asia. Telenor is involved
\u00a0
in several legal proceedings and discussions related to
its tax position where the outcome is uncertain. Uncertain tax positions
\u00a0
may require significant judgment including
assessment of future taxable profits and estimating the outcome
\u00a0
of significant tax disputes.
\u00a0
Accounting policies
Telenor bases its assessment of taxable income
\u00a0
on interpretation of relevant laws and regulations,
\u00a0
and when it is considered as probable that the
tax treatment
\u00a0
will be
\u00a0
sustained
\u00a0
in a tax
\u00a0
review. Current
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are measured
\u00a0
at the amount
\u00a0
expected
\u00a0
to be recovered
\u00a0
or paid
\u00a0
to
the tax authorities.
\u00a0
Deferred
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are calculated
\u00a0
using the
\u00a0
liability
\u00a0
method where
\u00a0
deferred
\u00a0
taxes are
\u00a0
recognised
\u00a0
on the
difference between the tax base and the
\u00a0
carrying amount of the assets and liabilities,
\u00a0
including tax losses carried forward. Deferred tax assets and
liabilities
\u00a0
are not recognised
\u00a0
on goodwill
\u00a0
or on investments
\u00a0
in subsidiaries,
\u00a0
associates,
\u00a0
or joint
\u00a0
ventures
\u00a0
where the
\u00a0
timing of
\u00a0
the reversal
\u00a0
can be
controlled,
\u00a0
and it is
\u00a0
probable
\u00a0
that the temporary
\u00a0
difference
\u00a0
will not be
\u00a0
reversed
\u00a0
in the foreseeable
\u00a0
future. Deferred
\u00a0
tax assets
\u00a0
are only
\u00a0
recognised
\u00a0
to
the extent
\u00a0
it is more
\u00a0
likely than
\u00a0
not that the
\u00a0
tax assets
\u00a0
will be
\u00a0
utilised.
\u00a0
Deferred
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are offset
\u00a0
when there
\u00a0
is a legally
\u00a0
enforceable
right, Telenor
\u00a0
is capable
\u00a0
to and intends
\u00a0
to settle
\u00a0
on a net
\u00a0
basis. The
\u00a0
enacted tax
\u00a0
rates at
\u00a0
the end of
\u00a0
the reporting
\u00a0
period and
\u00a0
undiscounted
\u00a0
amounts
are used. A change in deferred tax assets
\u00a0
and liabilities because of change in tax rates
\u00a0
is recognised in profit or loss, except when
\u00a0
it relates to items
that previously was recognised in other comprehensive income
\u00a0
or directly in equity. Deferred tax is provided for
\u00a0
undistributed earnings in
subsidiaries when distribution is expected in foreseeable future.
\u00a0
Deferred tax for undistributed earnings in associated
\u00a0
companies is provided for as
the timing
\u00a0
of the reversal
\u00a0
of the temporary
\u00a0
differences
\u00a0
cannot be
\u00a0
controlled
\u00a0
by Telenor.
Key judgments
\u00a0
and estimates
\u00a0
Significant judgements are required when assessing uncertain
\u00a0
tax assets, like tax losses carried forward. Such
\u00a0
judgment may include assessment
of taxable
\u00a0
profits in
\u00a0
futures years
\u00a0
as well
\u00a0
as tax planning
\u00a0
strategies
\u00a0
and the existence
\u00a0
of taxable
\u00a0
temporary
\u00a0
differences.
\u00a0
Entities
\u00a0
with a history
\u00a0
of
recent losses need convincing evidence that sufficient
\u00a0
future taxable profit will be generated before a tax
\u00a0
asset is recognised. Uncertainty related
to new transactions
\u00a0
and events
\u00a0
and the
\u00a0
interpretation
\u00a0
of new tax
\u00a0
rules may
\u00a0
also affect
\u00a0
these judgements.
Telenor is involved in various legal proceedings, disputes
\u00a0
and claims related to its income tax positions
\u00a0
where the outcomes is subject to significant
uncertainty. The management assessment may include interpretation
\u00a0
of relevant laws, regulations, and the outcome
\u00a0
of similar tax disputes in the
same jurisdiction, expert opinions from external tax
\u00a0
advisors and communication with the tax authorities.
\u00a0
A tax provision is recognised when an
unfavourable outcome is considered probable, and a
\u00a0
reliable estimate can be made. In Norway,
\u00a0
a formal decision made by the tax
\u00a0
authorities or
lower courts is presumed to represent the
\u00a0
best estimate for accounting purposes unless expert
\u00a0
opinions can point to errors clearly
\u00a0
indicating that
the tax assessment is incorrect. The tax
\u00a0
provision is updated whenever the assumptions change.
\u00a0
Tax disputes are disclosed in this note if they
\u00a0
are
considered
\u00a0
significant
\u00a0
for Telenor.
\u00a0
See also
\u00a0
note 23 Legal
\u00a0
Disputes
\u00a0
and contingencies.
Income tax expense
NOK in millions
2022
2021
Profit before taxes
10 732
13 723
Current taxes
( 411)
(5 864)
Deferred taxes
3 325
855
Income taxes
2 914
(5 008)
Current taxes
In 2022 current taxes are impacted mainly
\u00a0
by current tax income of NOK 3.1 billion
\u00a0
in Norway (see below reversal of tax expense
\u00a0
for the India
guarantee
\u00a0
for Unitech
\u00a0
Wireless,
\u00a0
reversal
\u00a0
of tax provision
\u00a0
in Norway
\u00a0
related
\u00a0
to losses
\u00a0
on loans and
\u00a0
guarantees,
\u00a0
and prior
\u00a0
year assessments
\u00a0
or
adjustments on current tax) and current tax
\u00a0
expense of NOK 2.3 billion in Bangladesh.
\u00a0
Current taxes in 2021 were impacted mainly by a
\u00a0
fine paid by
Telenor
\u00a0
to the Norwegian
\u00a0
Competition
\u00a0
Authority
\u00a0
(NCA)
\u00a0
for a claim
\u00a0
on an alleged
\u00a0
breach of
\u00a0
the prohibition
\u00a0
against abuse
\u00a0
of a dominant
\u00a0
position (see
comments
\u00a0
below on
\u00a0
NCA case).
In 2022 deferred taxes
are impacted mainly by NOK 2.1 billion in
\u00a0
Norway, mainly due to realisation of tax losses
\u00a0
related to an internal legal
restructuring in Asia, and
\u00a0
NOK 1.1 billion in Pakistan mainly related to
\u00a0
the impairment of fixed assts.
Effective tax
\u00a0
rate
\u00a0
The table below reconciles the reported income
\u00a0
tax expense to the expected income tax
\u00a0
expense according to the Norwegian corporate income
tax rate of 22%. It also discloses
\u00a0
the main elements of the tax expense.
\u00a0
Comments are provided on selected line items in
\u00a0
the table below.
NOK in millions
2022
2021
Income tax expense at corporate income tax
\u00a0
rate in Norway 22%
(2 361)
(3 019)
Effect of
\u00a0
tax rates
\u00a0
outside Norway
\u00a0
different
\u00a0
from 22%
( 625)
(1 135)
Effect of
\u00a0
changes in
\u00a0
tax rates
13
-
Current and deferred taxes on retained earnings
\u00a0
and dividend in subsidiaries and associated companies
( 70)
( 98)
Tax income from restructuring in Asia
3 136
Reversal of tax expense for the India
\u00a0
guarantee for Unitech Wireless
\u00a0
2 491
Divestment of fixed non-core assets in
\u00a0
Telenor Sweden
356
Reversal
\u00a0
of tax provision
\u00a0
in Norway
\u00a0
related
\u00a0
to losses on
\u00a0
loans and
\u00a0
guarantees
330
( 173)
Other items
( 594)
( 624)
Prior years
\u00a0
assessments
\u00a0
or adjustments
\u00a0
on current
\u00a0
tax
297
34
Deferred tax assets not recognised current year
( 66)
1
Change in previously not recognised deferred tax
\u00a0
assets
\u00a0
6
6
Income taxes
2 914
(5 008)
Effective
\u00a0
tax rate
\u00a0
in %
-27.1
36.5
Tax rates outside Norway different from 22%
\u00a0
Effects are mainly related to Grameenphone Ltd.
\u00a0
(Bangladesh: 40%) and Telenor Pakistan (33%) having higher
\u00a0
nominal tax rates than the nominal
tax rate for Norway. Telenor Sweden (20.6%),
\u00a0
DNA (Finland: 20%) and dtac (Thailand: 20%)
\u00a0
have lower nominal tax rates.
Effect of changes in tax rates
Pakistan enacted an increase of their corporate
\u00a0
income tax rate from 29% to 33%
\u00a0
in 2022.
Current and deferred taxes on retained earnings and dividend
\u00a0
in subsidiaries and associated companies
\u00a0
Includes current taxes on dividends received, as
\u00a0
well as change in deferred tax liability (primarily withholding tax)
\u00a0
recognised on undistributed
earnings
\u00a0
in subsidiaries
\u00a0
and associated
\u00a0
companies
\u00a0
outside of
\u00a0
Norway. Deferred
\u00a0
taxes on
\u00a0
retained
\u00a0
earnings in
\u00a0
foreign
\u00a0
subsidiaries
\u00a0
are provided
\u00a0
for
in full as of 31 December 2022 and 2021.
\u00a0
Tax income from restructuring in Asia
As a part of Telenor\u2019s new strategy,
\u00a0
an internal restructuring process has been initiated
\u00a0
to form a new Singapore holding company for
\u00a0
all Asian
mobile operations.
\u00a0
Telenor India
\u00a0
is not a part
\u00a0
of the strategy
\u00a0
for Asia
\u00a0
going forward,
\u00a0
and therefore
\u00a0
the company
\u00a0
holding
\u00a0
the interests
\u00a0
in India
\u00a0
has
been transferred from Telenor Mobile Communications AS
\u00a0
to Telenor Communications II AS. A deductible
\u00a0
tax loss of NOK 14.3 billion
\u00a0
was realised
for Norwegian purposes by the transaction. The
\u00a0
deductibility is based on an advanced binding ruling
\u00a0
from Norwegian tax authorities.
Reversal of tax expense for the India guarantee for Unitech
\u00a0
Wireless
In 2012, Telenor ASA recorded a loss after
\u00a0
having repaid, as guarantor, all Unitech Wireless\u2019 interest-bearing
\u00a0
borrowings, amounting to NOK 10.6
billion.
\u00a0
A deferred
\u00a0
tax asset
\u00a0
of NOK 2.5
\u00a0
billion was
\u00a0
recognised.
\u00a0
In 2013, the
\u00a0
business transfer
\u00a0
from Unitech
\u00a0
Wireless
\u00a0
to Telenor
\u00a0
India was
\u00a0
completed,
and Telenor
\u00a0
ASA deducted
\u00a0
NOK 9.3 billion
\u00a0
as loss on
\u00a0
guarantees
\u00a0
in its tax
\u00a0
filing.
\u00a0
In 2019, Telenor
\u00a0
ASA has received
\u00a0
a reassessment
\u00a0
order from
\u00a0
the
Norwegian tax authorities disallowing deduction for the
\u00a0
loss, which increases previous years\u2019 current income
\u00a0
tax with NOK 2.5 billion in 2019. The
decision
\u00a0
was upheld
\u00a0
by the Tax
\u00a0
Appeal Board.
\u00a0
Telenor ASA
\u00a0
has appealed
\u00a0
the decision
\u00a0
to the district
\u00a0
court. On
\u00a0
28 March
\u00a0
2022, the
\u00a0
district
\u00a0
court
decided in favour of Telenor ASA, and
\u00a0
the tax expense was reversed with NOK
\u00a0
2.5 billion in 2022. The government has appealed the
\u00a0
ruling to the
Appeal
\u00a0
Court, and
\u00a0
the appeal
\u00a0
is scheduled
\u00a0
to be heard
\u00a0
in April
\u00a0
2023.
Divestment of fixed non-core assets in Telenor Sweden
Telenor Sweden sold Open Universe and the
\u00a0
company\u2019s fibre to the home (FTTH) accesses
\u00a0
in the single dwelling unit (SDU) segment
\u00a0
to Global
Connect for
\u00a0
a total
\u00a0
consideration
\u00a0
of NOK 3
\u00a0
billion.
\u00a0
The transaction
\u00a0
generated
\u00a0
a pre-tax
\u00a0
gain on
\u00a0
disposal
\u00a0
of NOK 1.7
\u00a0
billion.
Reversal
\u00a0
of tax provision
\u00a0
in Norway
\u00a0
related to
\u00a0
losses on
\u00a0
loans and
\u00a0
guarantees.
Telenor ASA claimed deductions for losses on
\u00a0
loans and guarantees related to the subsidiary
\u00a0
Cinclus Technology AS in 2008 with NOK
\u00a0
0.5 billion
and in 2011
\u00a0
with NOK
\u00a0
0.7 billion.
\u00a0
The Tax Office
\u00a0
disallowed
\u00a0
deductions
\u00a0
for 2008
\u00a0
by decision
\u00a0
of 21 December
\u00a0
2016, and
\u00a0
for 2011 by
\u00a0
decision of
\u00a0
21
February 2018. Telenor ASA appealed the decisions. On
\u00a0
6 June 2022, the Tax Appeal Board
\u00a0
decided that Telenor ASA should be allowed
deductions,
\u00a0
and the tax
\u00a0
expense
\u00a0
was therefore
\u00a0
reversed.
Fine imposed by the Norwegian Competition Authority (NCA)
In 2021
\u00a0
Telenor paid
\u00a0
a fine of
\u00a0
NOK 0.8 billion
\u00a0
to NCA for
\u00a0
a claim
\u00a0
from 21 June
\u00a0
2018. The
\u00a0
claim relates
\u00a0
to an alleged
\u00a0
breach of
\u00a0
the prohibition
\u00a0
against
abuse of
\u00a0
a dominant
\u00a0
position related
\u00a0
to the pricing
\u00a0
model in one
\u00a0
mobile wholesale
\u00a0
agreement
\u00a0
in the mobile
\u00a0
market in
\u00a0
the period
\u00a0
2010-2014,
\u00a0
see
note 23 Legal
\u00a0
Disputes
\u00a0
and contingencies.
\u00a0
Other items
In 2022 non-deductible items are in line
\u00a0
with last year.
Prior year assessments or adjustments on current tax
In 2022 it is mainly related to reversal
\u00a0
of previous years\u2019 current income for pipes
\u00a0
and digging costs in Norway.
Tax losses carried
\u00a0
forward
Tax losses carried forward in selected countries expire
\u00a0
as follows as of 31 December 2022:
NOK in millions
Norway
Denmark
Thailand
Other
Total
2023
-
-
591
-
591
2024
-
-
999
1
1 000
2025
-
-
327
14
340
2026
-
-
516
15
531
2027
-
-
939
20
959
2028 and later
-
-
-
319
319
Not time-limited
12 484
590
379
283
13 737
Total tax
\u00a0
losses carried
\u00a0
forward
12 484
590
3 751
653
17 477
Of which
\u00a0
deferred
\u00a0
tax assets
\u00a0
have not been
\u00a0
recognised
-
154
431
542
1 127
Of which deferred tax assets have been recognised
12 484
436
3 320
111
16 350
Tax losses carried forward in selected countries expire
\u00a0
as follows as of 31 December 2021:
NOK in millions
Norway
Denmark
Thailand
Other
Total
2022
-
-
139
-
139
2023
-
-
2 063
1
2 064
2024
-
-
938
1
939
2025
-
-
305
2
307
2026
-
-
700
14
714
2027 and later
-
-
-
334
334
Not time-limited
-
735
366
242
1 344
Total tax
\u00a0
losses carried
\u00a0
forward
-
735
4 512
594
5 841
Of which
\u00a0
deferred
\u00a0
tax assets
\u00a0
have not been
\u00a0
recognised
-
146
427
485
1 059
Of which deferred tax assets have been recognised
-
589
4 085
109
4 782
In 2022, tax losses carried forward, before and
\u00a0
after valuation allowance, increased by NOK 11.6
\u00a0
billion, mainly due to recognition of NOK
\u00a0
12.5 billion
tax losses
\u00a0
carried
\u00a0
forward in
\u00a0
Norway, partly
\u00a0
offset by
\u00a0
the utilisation
\u00a0
of tax losses
\u00a0
in Denmark
\u00a0
and Thailand.
\u00a0
In 2021,
\u00a0
tax losses
\u00a0
carried
\u00a0
forward,
before and
\u00a0
after valuation
\u00a0
allowance,
\u00a0
decreased
\u00a0
by NOK 1.6
\u00a0
billion and
\u00a0
NOK 1.5 billion,
\u00a0
respectively,
\u00a0
mainly due
\u00a0
to utilisation
\u00a0
of tax losses
\u00a0
in Denmark
and Thailand.
Tax assets recognised on tax losses carried forward
Norway,
\u00a0
Thailand and Denmark have recognised tax assets on
\u00a0
unused tax losses as the Group expects there
\u00a0
will be sufficient future taxable profits
available
\u00a0
to utilise
\u00a0
these losses.
Uncertain tax
\u00a0
positions
Pakistan
Telenor Pakistan has received reassessment orders from
\u00a0
the Tax Authority concerning deductibility of certain expenses
\u00a0
in tax returns and
disputing
\u00a0
the adjustment
\u00a0
of advance
\u00a0
income tax
\u00a0
paid on import
\u00a0
of equipment
\u00a0
with a total
\u00a0
exposure of
\u00a0
NOK 2.1
\u00a0
billion.
\u00a0
Telenor Pakistan
\u00a0
is of the
opinion that
\u00a0
the deductibility
\u00a0
of these expenses
\u00a0
is in accordance
\u00a0
with the tax
\u00a0
law in Pakistan
\u00a0
(also supported
\u00a0
by external
\u00a0
legal advisors),
\u00a0
hence
Telenor
\u00a0
Pakistan
\u00a0
disagrees
\u00a0
with the reassessment
\u00a0
orders and
\u00a0
has challenged
\u00a0
the orders,
\u00a0
which are
\u00a0
pending at
\u00a0
various appellate
\u00a0
forums.
In 2012, Telenor ASA recorded a loss on
\u00a0
receivables on its Indian subsidiary Unitech Wireless
\u00a0
after having repaid, as guarantor, all Unitech Wireless\u2019
interest-bearing
\u00a0
borrowings,
\u00a0
amounting
\u00a0
to NOK 10.6
\u00a0
billion.
\u00a0
A deferred
\u00a0
tax asset
\u00a0
of NOK 2.5
\u00a0
billion was
\u00a0
recognised.
\u00a0
In 2013,
\u00a0
after the
\u00a0
business
transfer from
\u00a0
Unitech Wireless
\u00a0
to Telenor
\u00a0
India was
\u00a0
completed,
\u00a0
Telenor ASA
\u00a0
deducted
\u00a0
the actual
\u00a0
tax loss of
\u00a0
NOK 9.3
\u00a0
billion
\u00a0
in its tax
\u00a0
return. During
2017 and 2018 Telenor ASA received draft notices
\u00a0
of possible reassessment, and Telenor has disclosed
\u00a0
an uncertain tax position in its Annual
Reports since
\u00a0
2016. On
\u00a0
22 August
\u00a0
2019, Telenor
\u00a0
ASA received
\u00a0
a reassessment
\u00a0
order related
\u00a0
to income
\u00a0
year 2013,
\u00a0
disallowing
\u00a0
deduction
\u00a0
for the loss
Telenor ASA recognised in 2012. Following this
\u00a0
reassessment, Telenor ASA recognised a tax expense
\u00a0
of NOK 2.5 billion in the third quarter
\u00a0
2019 and
paid the amount on 3 October 2019.
\u00a0
Telenor ASA disagrees with the tax authorities\u2019 position
\u00a0
and appealed the reassessment. In a decision
\u00a0
received
10 February
\u00a0
2021 the Tax
\u00a0
Appeal Board
\u00a0
upheld the
\u00a0
reassessment.
\u00a0
Telenor
\u00a0
ASA appealed
\u00a0
the decision
\u00a0
to the district
\u00a0
court. On
\u00a0
28 March 2022,
\u00a0
the
district court decided in favour of Telenor ASA,
\u00a0
and the tax expense was reversed with
\u00a0
NOK 2.5 billion in 2022. The government has appealed
\u00a0
the
ruling to the Court of Appeal, and the
\u00a0
appeal is scheduled to be heard in April
\u00a0
2023.
Tax effect of
\u00a0
temporary differences
\u00a0
and tax losses
\u00a0
carried forward
\u00a0
as of 31 December
2022
2021
NOK in millions
Deferred
tax assets
Deferred tax
liabilities
Of which
deferred
not recognised
the income
statement
Deferred
tax assets
Deferred tax
liabilities
Of which
recognised
the income
statement
Tangible and intangible assets
1 791
(9 269)
( 142)
575
1 861
(11 885)
( 80)
618
Undistributed earnings in foreign subsidiaries
and associated
\u00a0
companies
-
( 207)
-
128
-
( 344)
-
106
Non-current borrowings
4 364
( 262)
-
524
4 920
( 169)
-
( 722)
Other non-current
\u00a0
items
761
( 994)
-
( 48)
1 262
(1 307)
-
121
Total non-current assets and liabilities
6 915
(10 733)
( 142)
1 180
8 043
(13 706)
( 80)
124
Total current
\u00a0
assets and
\u00a0
liabilities
2 532
( 204)
-
117
2 884
( 288)
-
955
Tax losses carried forward
3 757
-
( 229)
2 088
1 184
-
( 216)
( 241)
Valuation allowance recognised
\u00a0
in the income
\u00a0
statement
\u00a0
( 59)
17
Deferred tax recognised in the income
statement
3 325
855
Total deferred tax assets/liabilities
13 205
(10 937)
( 371)
12 111
(13 994)
( 296)
Net deferred tax assets/liabilities
-
1 897
-
-
(2 179)
-
Of which
\u00a0
deferred
\u00a0
tax assets
-
5 536
-
-
2 195
-
Of which deferred tax liabilities
-
(3 639)
-
-
(4 374)
-
For 2022,
\u00a0
total non-current
\u00a0
assets and
\u00a0
liabilities
\u00a0
decreased
\u00a0
by NOK 1.1
\u00a0
billion, and
\u00a0
NOK 3.0
\u00a0
billion respectively.
\u00a0
Out of those,
\u00a0
NOK 1.1
\u00a0
billion, and
\u00a0
NOK
2.4 billion respectively are related to the deconsolidation
\u00a0
of Digi. Total current assets decreased by NOK 0.7
\u00a0
billion for the same reason. For 2021,
the decrease
\u00a0
in deferred
\u00a0
tax assets
\u00a0
is mainly
\u00a0
related to
\u00a0
the reclassification
\u00a0
of Telenor
\u00a0
Myanmar
\u00a0
as discontinued
\u00a0
operations.
\u00a0
See also
\u00a0
note 12
\u00a0
Held
for sale and discontinued operations.
Changes in net
\u00a0
deferred tax
\u00a0
assets and liabilities
NOK in millions
2022
2021
As of 1 January
(2 179)
(1 990)
Recognised in the income statement
\u00a0
3 325
855
Recognised
\u00a0
in other
\u00a0
comprehensive
\u00a0
income
170
( 592)
Recognised directly to equity
( 11)
( 14)
Acquisitions and disposals of subsidiaries
644
9
Translation differences on deferred taxes
( 51)
64
Discontinued
\u00a0
operations
-
( 511)
As of 31 December
1 897
(2 179)
Recognised in the income statement
For 2022, the change of the amount
\u00a0
recognised in the income statement between 2022
\u00a0
and 2021 is related mainly to Norway and
\u00a0
Pakistan.
\u00a0
Recognised in other comprehensive income
For 2022,
\u00a0
the change
\u00a0
of the amount
\u00a0
recognised
\u00a0
in other
\u00a0
comprehensive
\u00a0
income between
\u00a0
2022 and
\u00a0
2021 is related
\u00a0
to losses
\u00a0
on net investment
hedges.
Acquisitions and disposals of subsidiaries
For 2022, the change of the amount
\u00a0
in acquisitions and disposals between 2022 and
\u00a0
2021 is related to the deconsolidation of Digi,
\u00a0
see note 12 Held
for sale
\u00a0
and discontinued
\u00a0
operations.
NOTE 10
Income taxes
Telenor is in a payable tax position in most jurisdictions. Nevertheless,
\u00a0
Telenor had a net tax income in 2022 of
27.1% as a result of favourable development in a tax dispute in Norway
\u00a0
and realisation of tax losses from
restructuring of shareholdings in Asia. Telenor is involved
\u00a0
in several legal proceedings and discussions related to
its tax position where the outcome is uncertain. Uncertain tax positions
\u00a0
may require significant judgment including
assessment of future taxable profits and estimating the outcome
\u00a0
of significant tax disputes.
\u00a0
Accounting policies
Telenor bases its assessment of taxable income
\u00a0
on interpretation of relevant laws and regulations,
\u00a0
and when it is considered as probable that the
tax treatment
\u00a0
will be
\u00a0
sustained
\u00a0
in a tax
\u00a0
review. Current
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are measured
\u00a0
at the amount
\u00a0
expected
\u00a0
to be recovered
\u00a0
or paid
\u00a0
to
the tax authorities.
\u00a0
Deferred
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are calculated
\u00a0
using the
\u00a0
liability
\u00a0
method where
\u00a0
deferred
\u00a0
taxes are
\u00a0
recognised
\u00a0
on the
difference between the tax base and the
\u00a0
carrying amount of the assets and liabilities,
\u00a0
including tax losses carried forward. Deferred tax assets and
liabilities
\u00a0
are not recognised
\u00a0
on goodwill
\u00a0
or on investments
\u00a0
in subsidiaries,
\u00a0
associates,
\u00a0
or joint
\u00a0
ventures
\u00a0
where the
\u00a0
timing of
\u00a0
the reversal
\u00a0
can be
controlled,
\u00a0
and it is
\u00a0
probable
\u00a0
that the temporary
\u00a0
difference
\u00a0
will not be
\u00a0
reversed
\u00a0
in the foreseeable
\u00a0
future. Deferred
\u00a0
tax assets
\u00a0
are only
\u00a0
recognised
\u00a0
to
the extent
\u00a0
it is more
\u00a0
likely than
\u00a0
not that the
\u00a0
tax assets
\u00a0
will be
\u00a0
utilised.
\u00a0
Deferred
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are offset
\u00a0
when there
\u00a0
is a legally
\u00a0
enforceable
right, Telenor
\u00a0
is capable
\u00a0
to and intends
\u00a0
to settle
\u00a0
on a net
\u00a0
basis. The
\u00a0
enacted tax
\u00a0
rates at
\u00a0
the end of
\u00a0
the reporting
\u00a0
period and
\u00a0
undiscounted
\u00a0
amounts
are used. A change in deferred tax assets
\u00a0
and liabilities because of change in tax rates
\u00a0
is recognised in profit or loss, except when
\u00a0
it relates to items
that previously was recognised in other comprehensive income
\u00a0
or directly in equity. Deferred tax is provided for
\u00a0
undistributed earnings in
subsidiaries when distribution is expected in foreseeable future.
\u00a0
Deferred tax for undistributed earnings in associated
\u00a0
companies is provided for as
the timing
\u00a0
of the reversal
\u00a0
of the temporary
\u00a0
differences
\u00a0
cannot be
\u00a0
controlled
\u00a0
by Telenor.
Key judgments
\u00a0
and estimates
\u00a0
Significant judgements are required when assessing uncertain
\u00a0
tax assets, like tax losses carried forward. Such
\u00a0
judgment may include assessment
of taxable
\u00a0
profits in
\u00a0
futures years
\u00a0
as well
\u00a0
as tax planning
\u00a0
strategies
\u00a0
and the existence
\u00a0
of taxable
\u00a0
temporary
\u00a0
differences.
\u00a0
Entities
\u00a0
with a history
\u00a0
of
recent losses need convincing evidence that sufficient
\u00a0
future taxable profit will be generated before a tax
\u00a0
asset is recognised. Uncertainty related
to new transactions
\u00a0
and events
\u00a0
and the
\u00a0
interpretation
\u00a0
of new tax
\u00a0
rules may
\u00a0
also affect
\u00a0
these judgements.
Telenor is involved in various legal proceedings, disputes
\u00a0
and claims related to its income tax positions
\u00a0
where the outcomes is subject to significant
uncertainty. The management assessment may include interpretation
\u00a0
of relevant laws, regulations, and the outcome
\u00a0
of similar tax disputes in the
same jurisdiction, expert opinions from external tax
\u00a0
advisors and communication with the tax authorities.
\u00a0
A tax provision is recognised when an
unfavourable outcome is considered probable, and a
\u00a0
reliable estimate can be made. In Norway,
\u00a0
a formal decision made by the tax
\u00a0
authorities or
lower courts is presumed to represent the
\u00a0
best estimate for accounting purposes unless expert
\u00a0
opinions can point to errors clearly
\u00a0
indicating that
the tax assessment is incorrect. The tax
\u00a0
provision is updated whenever the assumptions change.
\u00a0
Tax disputes are disclosed in this note if they
\u00a0
are
considered
\u00a0
significant
\u00a0
for Telenor.
\u00a0
See also
\u00a0
note 23 Legal
\u00a0
Disputes
\u00a0
and contingencies.
Income tax expense
NOK in millions
2022
2021
Profit before taxes
10 732
13 723
Current taxes
( 411)
(5 864)
Deferred taxes
3 325
855
Income taxes
2 914
(5 008)
Current taxes
In 2022 current taxes are impacted mainly
\u00a0
by current tax income of NOK 3.1 billion
\u00a0
in Norway (see below reversal of tax expense
\u00a0
for the India
guarantee
\u00a0
for Unitech
\u00a0
Wireless,
\u00a0
reversal
\u00a0
of tax provision
\u00a0
in Norway
\u00a0
related
\u00a0
to losses
\u00a0
on loans and
\u00a0
guarantees,
\u00a0
and prior
\u00a0
year assessments
\u00a0
or
adjustments on current tax) and current tax
\u00a0
expense of NOK 2.3 billion in Bangladesh.
\u00a0
Current taxes in 2021 were impacted mainly by a
\u00a0
fine paid by
Telenor
\u00a0
to the Norwegian
\u00a0
Competition
\u00a0
Authority
\u00a0
(NCA)
\u00a0
for a claim
\u00a0
on an alleged
\u00a0
breach of
\u00a0
the prohibition
\u00a0
against abuse
\u00a0
of a dominant
\u00a0
position (see
comments
\u00a0
below on
\u00a0
NCA case).
In 2022 deferred taxes
are impacted mainly by NOK 2.1 billion in
\u00a0
Norway, mainly due to realisation of tax losses
\u00a0
related to an internal legal
restructuring in Asia, and
\u00a0
NOK 1.1 billion in Pakistan mainly related to
\u00a0
the impairment of fixed assts.
Effective tax
\u00a0
rate
\u00a0
The table below reconciles the reported income
\u00a0
tax expense to the expected income tax
\u00a0
expense according to the Norwegian corporate income
tax rate of 22%. It also discloses
\u00a0
the main elements of the tax expense.
\u00a0
Comments are provided on selected line items in
\u00a0
the table below.
NOK in millions
2022
2021
Income tax expense at corporate income tax
\u00a0
rate in Norway 22%
(2 361)
(3 019)
Effect of
\u00a0
tax rates
\u00a0
outside Norway
\u00a0
different
\u00a0
from 22%
( 625)
(1 135)
Effect of
\u00a0
changes in
\u00a0
tax rates
13
-
Current and deferred taxes on retained earnings
\u00a0
and dividend in subsidiaries and associated companies
( 70)
( 98)
Tax income from restructuring in Asia
3 136
Reversal of tax expense for the India
\u00a0
guarantee for Unitech Wireless
\u00a0
2 491
Divestment of fixed non-core assets in
\u00a0
Telenor Sweden
356
Reversal
\u00a0
of tax provision
\u00a0
in Norway
\u00a0
related
\u00a0
to losses on
\u00a0
loans and
\u00a0
guarantees
330
( 173)
Other items
( 594)
( 624)
Prior years
\u00a0
assessments
\u00a0
or adjustments
\u00a0
on current
\u00a0
tax
297
34
Deferred tax assets not recognised current year
( 66)
1
Change in previously not recognised deferred tax
\u00a0
assets
\u00a0
6
6
Income taxes
2 914
(5 008)
Effective
\u00a0
tax rate
\u00a0
in %
-27.1
36.5
Tax rates outside Norway different from 22%
\u00a0
Effects are mainly related to Grameenphone Ltd.
\u00a0
(Bangladesh: 40%) and Telenor Pakistan (33%) having higher
\u00a0
nominal tax rates than the nominal
tax rate for Norway. Telenor Sweden (20.6%),
\u00a0
DNA (Finland: 20%) and dtac (Thailand: 20%)
\u00a0
have lower nominal tax rates.
Effect of changes in tax rates
Pakistan enacted an increase of their corporate
\u00a0
income tax rate from 29% to 33%
\u00a0
in 2022.
Current and deferred taxes on retained earnings and dividend
\u00a0
in subsidiaries and associated companies
\u00a0
Includes current taxes on dividends received, as
\u00a0
well as change in deferred tax liability (primarily withholding tax)
\u00a0
recognised on undistributed
earnings
\u00a0
in subsidiaries
\u00a0
and associated
\u00a0
companies
\u00a0
outside of
\u00a0
Norway. Deferred
\u00a0
taxes on
\u00a0
retained
\u00a0
earnings in
\u00a0
foreign
\u00a0
subsidiaries
\u00a0
are provided
\u00a0
for
in full as of 31 December 2022 and 2021.
\u00a0
Tax income from restructuring in Asia
As a part of Telenor\u2019s new strategy,
\u00a0
an internal restructuring process has been initiated
\u00a0
to form a new Singapore holding company for
\u00a0
all Asian
mobile operations.
\u00a0
Telenor India
\u00a0
is not a part
\u00a0
of the strategy
\u00a0
for Asia
\u00a0
going forward,
\u00a0
and therefore
\u00a0
the company
\u00a0
holding
\u00a0
the interests
\u00a0
in India
\u00a0
has
been transferred from Telenor Mobile Communications AS
\u00a0
to Telenor Communications II AS. A deductible
\u00a0
tax loss of NOK 14.3 billion
\u00a0
was realised
for Norwegian purposes by the transaction. The
\u00a0
deductibility is based on an advanced binding ruling
\u00a0
from Norwegian tax authorities.
Reversal of tax expense for the India guarantee for Unitech
\u00a0
Wireless
In 2012, Telenor ASA recorded a loss after
\u00a0
having repaid, as guarantor, all Unitech Wireless\u2019 interest-bearing
\u00a0
borrowings, amounting to NOK 10.6
billion.
\u00a0
A deferred
\u00a0
tax asset
\u00a0
of NOK 2.5
\u00a0
billion was
\u00a0
recognised.
\u00a0
In 2013, the
\u00a0
business transfer
\u00a0
from Unitech
\u00a0
Wireless
\u00a0
to Telenor
\u00a0
India was
\u00a0
completed,
and Telenor
\u00a0
ASA deducted
\u00a0
NOK 9.3 billion
\u00a0
as loss on
\u00a0
guarantees
\u00a0
in its tax
\u00a0
filing.
\u00a0
In 2019, Telenor
\u00a0
ASA has received
\u00a0
a reassessment
\u00a0
order from
\u00a0
the
Norwegian tax authorities disallowing deduction for the
\u00a0
loss, which increases previous years\u2019 current income
\u00a0
tax with NOK 2.5 billion in 2019. The
decision
\u00a0
was upheld
\u00a0
by the Tax
\u00a0
Appeal Board.
\u00a0
Telenor ASA
\u00a0
has appealed
\u00a0
the decision
\u00a0
to the district
\u00a0
court. On
\u00a0
28 March
\u00a0
2022, the
\u00a0
district
\u00a0
court
decided in favour of Telenor ASA, and
\u00a0
the tax expense was reversed with NOK
\u00a0
2.5 billion in 2022. The government has appealed the
\u00a0
ruling to the
Appeal
\u00a0
Court, and
\u00a0
the appeal
\u00a0
is scheduled
\u00a0
to be heard
\u00a0
in April
\u00a0
2023.
Divestment of fixed non-core assets in Telenor Sweden
Telenor Sweden sold Open Universe and the
\u00a0
company\u2019s fibre to the home (FTTH) accesses
\u00a0
in the single dwelling unit (SDU) segment
\u00a0
to Global
Connect for
\u00a0
a total
\u00a0
consideration
\u00a0
of NOK 3
\u00a0
billion.
\u00a0
The transaction
\u00a0
generated
\u00a0
a pre-tax
\u00a0
gain on
\u00a0
disposal
\u00a0
of NOK 1.7
\u00a0
billion.
Reversal
\u00a0
of tax provision
\u00a0
in Norway
\u00a0
related to
\u00a0
losses on
\u00a0
loans and
\u00a0
guarantees.
Telenor ASA claimed deductions for losses on
\u00a0
loans and guarantees related to the subsidiary
\u00a0
Cinclus Technology AS in 2008 with NOK
\u00a0
0.5 billion
and in 2011
\u00a0
with NOK
\u00a0
0.7 billion.
\u00a0
The Tax Office
\u00a0
disallowed
\u00a0
deductions
\u00a0
for 2008
\u00a0
by decision
\u00a0
of 21 December
\u00a0
2016, and
\u00a0
for 2011 by
\u00a0
decision of
\u00a0
21
February 2018. Telenor ASA appealed the decisions. On
\u00a0
6 June 2022, the Tax Appeal Board
\u00a0
decided that Telenor ASA should be allowed
deductions,
\u00a0
and the tax
\u00a0
expense
\u00a0
was therefore
\u00a0
reversed.
Fine imposed by the Norwegian Competition Authority (NCA)
In 2021
\u00a0
Telenor paid
\u00a0
a fine of
\u00a0
NOK 0.8 billion
\u00a0
to NCA for
\u00a0
a claim
\u00a0
from 21 June
\u00a0
2018. The
\u00a0
claim relates
\u00a0
to an alleged
\u00a0
breach of
\u00a0
the prohibition
\u00a0
against
abuse of
\u00a0
a dominant
\u00a0
position related
\u00a0
to the pricing
\u00a0
model in one
\u00a0
mobile wholesale
\u00a0
agreement
\u00a0
in the mobile
\u00a0
market in
\u00a0
the period
\u00a0
2010-2014,
\u00a0
see
note 23 Legal
\u00a0
Disputes
\u00a0
and contingencies.
\u00a0
Other items
In 2022 non-deductible items are in line
\u00a0
with last year.
Prior year assessments or adjustments on current tax
In 2022 it is mainly related to reversal
\u00a0
of previous years\u2019 current income for pipes
\u00a0
and digging costs in Norway.
Tax losses carried
\u00a0
forward
Tax losses carried forward in selected countries expire
\u00a0
as follows as of 31 December 2022:
NOK in millions
Norway
Denmark
Thailand
Other
Total
2023
-
-
591
-
591
2024
-
-
999
1
1 000
2025
-
-
327
14
340
2026
-
-
516
15
531
2027
-
-
939
20
959
2028 and later
-
-
-
319
319
Not time-limited
12 484
590
379
283
13 737
Total tax
\u00a0
losses carried
\u00a0
forward
12 484
590
3 751
653
17 477
Of which
\u00a0
deferred
\u00a0
tax assets
\u00a0
have not been
\u00a0
recognised
-
154
431
542
1 127
Of which deferred tax assets have been recognised
12 484
436
3 320
111
16 350
Tax losses carried forward in selected countries expire
\u00a0
as follows as of 31 December 2021:
NOK in millions
Norway
Denmark
Thailand
Other
Total
2022
-
-
139
-
139
2023
-
-
2 063
1
2 064
2024
-
-
938
1
939
2025
-
-
305
2
307
2026
-
-
700
14
714
2027 and later
-
-
-
334
334
Not time-limited
-
735
366
242
1 344
Total tax
\u00a0
losses carried
\u00a0
forward
-
735
4 512
594
5 841
Of which
\u00a0
deferred
\u00a0
tax assets
\u00a0
have not been
\u00a0
recognised
-
146
427
485
1 059
Of which deferred tax assets have been recognised
-
589
4 085
109
4 782
In 2022, tax losses carried forward, before and
\u00a0
after valuation allowance, increased by NOK 11.6
\u00a0
billion, mainly due to recognition of NOK
\u00a0
12.5 billion
tax losses
\u00a0
carried
\u00a0
forward in
\u00a0
Norway, partly
\u00a0
offset by
\u00a0
the utilisation
\u00a0
of tax losses
\u00a0
in Denmark
\u00a0
and Thailand.
\u00a0
In 2021,
\u00a0
tax losses
\u00a0
carried
\u00a0
forward,
before and
\u00a0
after valuation
\u00a0
allowance,
\u00a0
decreased
\u00a0
by NOK 1.6
\u00a0
billion and
\u00a0
NOK 1.5 billion,
\u00a0
respectively,
\u00a0
mainly due
\u00a0
to utilisation
\u00a0
of tax losses
\u00a0
in Denmark
and Thailand.
Tax assets recognised on tax losses carried forward
Norway,
\u00a0
Thailand and Denmark have recognised tax assets on
\u00a0
unused tax losses as the Group expects there
\u00a0
will be sufficient future taxable profits
available
\u00a0
to utilise
\u00a0
these losses.
Uncertain tax
\u00a0
positions
Pakistan
Telenor Pakistan has received reassessment orders from
\u00a0
the Tax Authority concerning deductibility of certain expenses
\u00a0
in tax returns and
disputing
\u00a0
the adjustment
\u00a0
of advance
\u00a0
income tax
\u00a0
paid on import
\u00a0
of equipment
\u00a0
with a total
\u00a0
exposure of
\u00a0
NOK 2.1
\u00a0
billion.
\u00a0
Telenor Pakistan
\u00a0
is of the
opinion that
\u00a0
the deductibility
\u00a0
of these expenses
\u00a0
is in accordance
\u00a0
with the tax
\u00a0
law in Pakistan
\u00a0
(also supported
\u00a0
by external
\u00a0
legal advisors),
\u00a0
hence
Telenor
\u00a0
Pakistan
\u00a0
disagrees
\u00a0
with the reassessment
\u00a0
orders and
\u00a0
has challenged
\u00a0
the orders,
\u00a0
which are
\u00a0
pending at
\u00a0
various appellate
\u00a0
forums.
In 2012, Telenor ASA recorded a loss on
\u00a0
receivables on its Indian subsidiary Unitech Wireless
\u00a0
after having repaid, as guarantor, all Unitech Wireless\u2019
interest-bearing
\u00a0
borrowings,
\u00a0
amounting
\u00a0
to NOK 10.6
\u00a0
billion.
\u00a0
A deferred
\u00a0
tax asset
\u00a0
of NOK 2.5
\u00a0
billion was
\u00a0
recognised.
\u00a0
In 2013,
\u00a0
after the
\u00a0
business
transfer from
\u00a0
Unitech Wireless
\u00a0
to Telenor
\u00a0
India was
\u00a0
completed,
\u00a0
Telenor ASA
\u00a0
deducted
\u00a0
the actual
\u00a0
tax loss of
\u00a0
NOK 9.3
\u00a0
billion
\u00a0
in its tax
\u00a0
return. During
2017 and 2018 Telenor ASA received draft notices
\u00a0
of possible reassessment, and Telenor has disclosed
\u00a0
an uncertain tax position in its Annual
Reports since
\u00a0
2016. On
\u00a0
22 August
\u00a0
2019, Telenor
\u00a0
ASA received
\u00a0
a reassessment
\u00a0
order related
\u00a0
to income
\u00a0
year 2013,
\u00a0
disallowing
\u00a0
deduction
\u00a0
for the loss
Telenor ASA recognised in 2012. Following this
\u00a0
reassessment, Telenor ASA recognised a tax expense
\u00a0
of NOK 2.5 billion in the third quarter
\u00a0
2019 and
paid the amount on 3 October 2019.
\u00a0
Telenor ASA disagrees with the tax authorities\u2019 position
\u00a0
and appealed the reassessment. In a decision
\u00a0
received
10 February
\u00a0
2021 the Tax
\u00a0
Appeal Board
\u00a0
upheld the
\u00a0
reassessment.
\u00a0
Telenor
\u00a0
ASA appealed
\u00a0
the decision
\u00a0
to the district
\u00a0
court. On
\u00a0
28 March 2022,
\u00a0
the
district court decided in favour of Telenor ASA,
\u00a0
and the tax expense was reversed with
\u00a0
NOK 2.5 billion in 2022. The government has appealed
\u00a0
the
ruling to the Court of Appeal, and the
\u00a0
appeal is scheduled to be heard in April
\u00a0
2023.
Tax effect of
\u00a0
temporary differences
\u00a0
and tax losses
\u00a0
carried forward
\u00a0
as of 31 December
2022
2021
NOK in millions
Deferred
tax assets
Deferred tax
liabilities
Of which
deferred
not recognised
the income
statement
Deferred
tax assets
Deferred tax
liabilities
Of which
recognised
the income
statement
Tangible and intangible assets
1 791
(9 269)
( 142)
575
1 861
(11 885)
( 80)
618
Undistributed earnings in foreign subsidiaries
and associated
\u00a0
companies
-
( 207)
-
128
-
( 344)
-
106
Non-current borrowings
4 364
( 262)
-
524
4 920
( 169)
-
( 722)
Other non-current
\u00a0
items
761
( 994)
-
( 48)
1 262
(1 307)
-
121
Total non-current assets and liabilities
6 915
(10 733)
( 142)
1 180
8 043
(13 706)
( 80)
124
Total current
\u00a0
assets and
\u00a0
liabilities
2 532
( 204)
-
117
2 884
( 288)
-
955
Tax losses carried forward
3 757
-
( 229)
2 088
1 184
-
( 216)
( 241)
Valuation allowance recognised
\u00a0
in the income
\u00a0
statement
\u00a0
( 59)
17
Deferred tax recognised in the income
statement
3 325
855
Total deferred tax assets/liabilities
13 205
(10 937)
( 371)
12 111
(13 994)
( 296)
Net deferred tax assets/liabilities
-
1 897
-
-
(2 179)
-
Of which
\u00a0
deferred
\u00a0
tax assets
-
5 536
-
-
2 195
-
Of which deferred tax liabilities
-
(3 639)
-
-
(4 374)
-
For 2022,
\u00a0
total non-current
\u00a0
assets and
\u00a0
liabilities
\u00a0
decreased
\u00a0
by NOK 1.1
\u00a0
billion, and
\u00a0
NOK 3.0
\u00a0
billion respectively.
\u00a0
Out of those,
\u00a0
NOK 1.1
\u00a0
billion, and
\u00a0
NOK
2.4 billion respectively are related to the deconsolidation
\u00a0
of Digi. Total current assets decreased by NOK 0.7
\u00a0
billion for the same reason. For 2021,
the decrease
\u00a0
in deferred
\u00a0
tax assets
\u00a0
is mainly
\u00a0
related to
\u00a0
the reclassification
\u00a0
of Telenor
\u00a0
Myanmar
\u00a0
as discontinued
\u00a0
operations.
\u00a0
See also
\u00a0
note 12
\u00a0
Held
for sale and discontinued operations.
Changes in net
\u00a0
deferred tax
\u00a0
assets and liabilities
NOK in millions
2022
2021
As of 1 January
(2 179)
(1 990)
Recognised in the income statement
\u00a0
3 325
855
Recognised
\u00a0
in other
\u00a0
comprehensive
\u00a0
income
170
( 592)
Recognised directly to equity
( 11)
( 14)
Acquisitions and disposals of subsidiaries
644
9
Translation differences on deferred taxes
( 51)
64
Discontinued
\u00a0
operations
-
( 511)
As of 31 December
1 897
(2 179)
Recognised in the income statement
For 2022, the change of the amount
\u00a0
recognised in the income statement between 2022
\u00a0
and 2021 is related mainly to Norway and
\u00a0
Pakistan.
\u00a0
Recognised in other comprehensive income
For 2022,
\u00a0
the change
\u00a0
of the amount
\u00a0
recognised
\u00a0
in other
\u00a0
comprehensive
\u00a0
income between
\u00a0
2022 and
\u00a0
2021 is related
\u00a0
to losses
\u00a0
on net investment
hedges.
Acquisitions and disposals of subsidiaries
For 2022, the change of the amount
\u00a0
in acquisitions and disposals between 2022 and
\u00a0
2021 is related to the deconsolidation of Digi,
\u00a0
see note 12 Held
for sale
\u00a0
and discontinued
\u00a0
operations.
Accounting policies
Telenor bases its assessment of taxable income
\u00a0
on interpretation of relevant laws and regulations,
\u00a0
and when it is considered as probable that the
tax treatment
\u00a0
will be
\u00a0
sustained
\u00a0
in a tax
\u00a0
review. Current
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are measured
\u00a0
at the amount
\u00a0
expected
\u00a0
to be recovered
\u00a0
or paid
\u00a0
to
the tax authorities.
\u00a0
Deferred
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are calculated
\u00a0
using the
\u00a0
liability
\u00a0
method where
\u00a0
deferred
\u00a0
taxes are
\u00a0
recognised
\u00a0
on the
difference between the tax base and the
\u00a0
carrying amount of the assets and liabilities,
\u00a0
including tax losses carried forward. Deferred tax assets and
liabilities
\u00a0
are not recognised
\u00a0
on goodwill
\u00a0
or on investments
\u00a0
in subsidiaries,
\u00a0
associates,
\u00a0
or joint
\u00a0
ventures
\u00a0
where the
\u00a0
timing of
\u00a0
the reversal
\u00a0
can be
controlled,
\u00a0
and it is
\u00a0
probable
\u00a0
that the temporary
\u00a0
difference
\u00a0
will not be
\u00a0
reversed
\u00a0
in the foreseeable
\u00a0
future. Deferred
\u00a0
tax assets
\u00a0
are only
\u00a0
recognised
\u00a0
to
the extent
\u00a0
it is more
\u00a0
likely than
\u00a0
not that the
\u00a0
tax assets
\u00a0
will be
\u00a0
utilised.
\u00a0
Deferred
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are offset
\u00a0
when there
\u00a0
is a legally
\u00a0
enforceable
right, Telenor
\u00a0
is capable
\u00a0
to and intends
\u00a0
to settle
\u00a0
on a net
\u00a0
basis. The
\u00a0
enacted tax
\u00a0
rates at
\u00a0
the end of
\u00a0
the reporting
\u00a0
period and
\u00a0
undiscounted
\u00a0
amounts
are used. A change in deferred tax assets
\u00a0
and liabilities because of change in tax rates
\u00a0
is recognised in profit or loss, except when
\u00a0
it relates to items
that previously was recognised in other comprehensive income
\u00a0
or directly in equity. Deferred tax is provided for
\u00a0
undistributed earnings in
subsidiaries when distribution is expected in foreseeable future.
\u00a0
Deferred tax for undistributed earnings in associated
\u00a0
companies is provided for as
the timing
\u00a0
of the reversal
\u00a0
of the temporary
\u00a0
differences
\u00a0
cannot be
\u00a0
controlled
\u00a0
by Telenor.
Telenor bases its assessment of taxable income
\u00a0
on interpretation of relevant laws and regulations,
\u00a0
and when it is considered as probable that the
tax treatment
\u00a0
will be
\u00a0
sustained
\u00a0
in a tax
\u00a0
review. Current
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are measured
\u00a0
at the amount
\u00a0
expected
\u00a0
to be recovered
\u00a0
or paid
\u00a0
to
the tax authorities.
\u00a0
Deferred
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are calculated
\u00a0
using the
\u00a0
liability
\u00a0
method where
\u00a0
deferred
\u00a0
taxes are
\u00a0
recognised
\u00a0
on the
difference between the tax base and the
\u00a0
carrying amount of the assets and liabilities,
\u00a0
including tax losses carried forward. Deferred tax assets and
liabilities
\u00a0
are not recognised
\u00a0
on goodwill
\u00a0
or on investments
\u00a0
in subsidiaries,
\u00a0
associates,
\u00a0
or joint
\u00a0
ventures
\u00a0
where the
\u00a0
timing of
\u00a0
the reversal
\u00a0
can be
controlled,
\u00a0
and it is
\u00a0
probable
\u00a0
that the temporary
\u00a0
difference
\u00a0
will not be
\u00a0
reversed
\u00a0
in the foreseeable
\u00a0
future. Deferred
\u00a0
tax assets
\u00a0
are only
\u00a0
recognised
\u00a0
to
the extent
\u00a0
it is more
\u00a0
likely than
\u00a0
not that the
\u00a0
tax assets
\u00a0
will be
\u00a0
utilised.
\u00a0
Deferred
\u00a0
tax assets
\u00a0
and liabilities
\u00a0
are offset
\u00a0
when there
\u00a0
is a legally
\u00a0
enforceable
right, Telenor
\u00a0
is capable
\u00a0
to and intends
\u00a0
to settle
\u00a0
on a net
\u00a0
basis. The
\u00a0
enacted tax
\u00a0
rates at
\u00a0
the end of
\u00a0
the reporting
\u00a0
period and
\u00a0
undiscounted
\u00a0
amounts
are used. A change in deferred tax assets
\u00a0
and liabilities because of change in tax rates
\u00a0
is recognised in profit or loss, except when
\u00a0
it relates to items
that previously was recognised in other comprehensive income
\u00a0
or directly in equity. Deferred tax is provided for
\u00a0
undistributed earnings in
subsidiaries when distribution is expected in foreseeable future.
\u00a0
Deferred tax for undistributed earnings in associated
\u00a0
companies is provided for as
the timing
\u00a0
of the reversal
\u00a0
of the temporary
\u00a0
differences
\u00a0
cannot be
\u00a0
controlled
\u00a0
by Telenor.
.
NOTE 11
Earnings per share and dividends
The earnings per share (EPS) of NOK 32.09 in 2022 was
\u00a0
significantly impacted by the gain from the merger
between Digi and Celcom, see further information in note 12. The
\u00a0
EPS from continuing operations was NOK 7.85 in
2022 compared to NOK 4.04 in 2021. The dividend policy in Telenor
\u00a0
is to aim for a year-on-year growth in nominal
dividend per share.
\u00a0
The annual dividends are normally paid in two instalments.
\u00a0
The Board of Directors has
proposed a dividend of NOK 9.40 per share for 2022.
\u00a0
Accounting policies
Earnings per share (EPS) is the amount of
\u00a0
profit generated for the financial year attributable
\u00a0
to equity shareholders divided by the weighted
average ordinary outstanding shares.
The calculations
\u00a0
of earnings
\u00a0
per share
\u00a0
attributable
\u00a0
to the ordinary
\u00a0
equity holders
\u00a0
of Telenor
\u00a0
ASA are
\u00a0
based on the
\u00a0
following
\u00a0
net income
\u00a0
and share
data:
Net income to equity holders of Telenor ASA
NOK in millions
2022
2021
Net income
\u00a0
from continuing
\u00a0
operations
10 980
5 651
Net income
\u00a0
(loss) from
\u00a0
discontinued
\u00a0
operations
33 932
(4 123)
Net income
\u00a0
from total
\u00a0
operations
44 913
1 528
Number of shares
In thousands
2022
2021
Weighted
\u00a0
average number
\u00a0
of shares
\u00a0
for the purpose
\u00a0
of basic
\u00a0
earnings
\u00a0
per share
1 399 458
1 399 458
Basic/Diluted earnings per share
NOK
2022
2021
Basic/Diluted earnings per share from continuing operations
7.85
4.04
Basic/Diluted earnings per share from discontinued operations
24.25
(2.95)
Basic/Diluted earnings per share for total operations
32.09
1.09
2022
2021
Ordinary
\u00a0
dividend
\u00a0
per share
\u00a0
in NOK \u2013 paid
9.30
9.00
Ordinary
\u00a0
dividend
\u00a0
per share
\u00a0
in NOK - proposed
\u00a0
by the Board
\u00a0
of Directors
9.40
9.30
Total dividend of NOK 13.0 billion has
\u00a0
been paid and charged to equity in
\u00a0
2022 (NOK 12.6 billion in 2021).
\u00a0
In respect of 2022, the Board of
\u00a0
Directors proposed an ordinary dividend of NOK
9.40
, to be resolved by the Annual General
\u00a0
Meeting on 10 May
2023. The
\u00a0
total amount
\u00a0
of dividend
\u00a0
is estimated
\u00a0
to be NOK
\u00a0
13.2 billion
\u00a0
based on
\u00a0
the outstanding
\u00a0
number of
\u00a0
shares as
\u00a0
of 31 December
\u00a0
2022. The
dividend
\u00a0
will be split
\u00a0
into two
\u00a0
tranches of
\u00a0
NOK 5.00
\u00a0
and NOK 4.40
\u00a0
per share
\u00a0
to be paid
\u00a0
out in May
\u00a0
2023
\u00a0
and October
\u00a0
2023, respectively.
Paid ordinary dividends per share was NOK
9.30
9.00
Dividends paid
\u00a0
to non-controlling
\u00a0
interests
\u00a0
During 2022,
\u00a0
dividends
\u00a0
paid to non-controlling
\u00a0
interests
\u00a0
in subsidiaries
\u00a0
amounted
\u00a0
to NOK 3.6
\u00a0
billion
\u00a0
(NOK 1.2
\u00a0
billion in
\u00a0
Digi, NOK
\u00a0
1.6 billion
\u00a0
in
Grameenphone and NOK 0.7 billion in dtac).
\u00a0
During 2021,
\u00a0
dividends
\u00a0
paid to non-controlling
\u00a0
interests
\u00a0
in subsidiaries
\u00a0
amounted to
\u00a0
NOK 3.2
\u00a0
billion (NOK
\u00a0
1.5 billion
\u00a0
in Digi,
\u00a0
NOK 1.1 billion
\u00a0
in
Grameenphone and NOK 0.6 billion in dtac).
.
NOTE 11
Earnings per share and dividends
The earnings per share (EPS) of NOK 32.09 in 2022 was
\u00a0
significantly impacted by the gain from the merger
between Digi and Celcom, see further information in note 12. The
\u00a0
EPS from continuing operations was NOK 7.85 in
2022 compared to NOK 4.04 in 2021. The dividend policy in Telenor
\u00a0
is to aim for a year-on-year growth in nominal
dividend per share.
\u00a0
The annual dividends are normally paid in two instalments.
\u00a0
The Board of Directors has
proposed a dividend of NOK 9.40 per share for 2022.
\u00a0
Accounting policies
Earnings per share (EPS) is the amount of
\u00a0
profit generated for the financial year attributable
\u00a0
to equity shareholders divided by the weighted
average ordinary outstanding shares.
The calculations
\u00a0
of earnings
\u00a0
per share
\u00a0
attributable
\u00a0
to the ordinary
\u00a0
equity holders
\u00a0
of Telenor
\u00a0
ASA are
\u00a0
based on the
\u00a0
following
\u00a0
net income
\u00a0
and share
data:
Net income to equity holders of Telenor ASA
NOK in millions
2022
2021
Net income
\u00a0
from continuing
\u00a0
operations
10 980
5 651
Net income
\u00a0
(loss) from
\u00a0
discontinued
\u00a0
operations
33 932
(4 123)
Net income
\u00a0
from total
\u00a0
operations
44 913
1 528
Number of shares
In thousands
2022
2021
Weighted
\u00a0
average number
\u00a0
of shares
\u00a0
for the purpose
\u00a0
of basic
\u00a0
earnings
\u00a0
per share
1 399 458
1 399 458
Basic/Diluted earnings per share
NOK
2022
2021
Basic/Diluted earnings per share from continuing operations
7.85
4.04
Basic/Diluted earnings per share from discontinued operations
24.25
(2.95)
Basic/Diluted earnings per share for total operations
32.09
1.09
2022
2021
Ordinary
\u00a0
dividend
\u00a0
per share
\u00a0
in NOK \u2013 paid
9.30
9.00
Ordinary
\u00a0
dividend
\u00a0
per share
\u00a0
in NOK - proposed
\u00a0
by the Board
\u00a0
of Directors
9.40
9.30
Total dividend of NOK 13.0 billion has
\u00a0
been paid and charged to equity in
\u00a0
2022 (NOK 12.6 billion in 2021).
\u00a0
In respect of 2022, the Board of
\u00a0
Directors proposed an ordinary dividend of NOK
9.40
, to be resolved by the Annual General
\u00a0
Meeting on 10 May
2023. The
\u00a0
total amount
\u00a0
of dividend
\u00a0
is estimated
\u00a0
to be NOK
\u00a0
13.2 billion
\u00a0
based on
\u00a0
the outstanding
\u00a0
number of
\u00a0
shares as
\u00a0
of 31 December
\u00a0
2022. The
dividend
\u00a0
will be split
\u00a0
into two
\u00a0
tranches of
\u00a0
NOK 5.00
\u00a0
and NOK 4.40
\u00a0
per share
\u00a0
to be paid
\u00a0
out in May
\u00a0
2023
\u00a0
and October
\u00a0
2023, respectively.
Paid ordinary dividends per share was NOK
9.30
9.00
Dividends paid
\u00a0
to non-controlling
\u00a0
interests
\u00a0
During 2022,
\u00a0
dividends
\u00a0
paid to non-controlling
\u00a0
interests
\u00a0
in subsidiaries
\u00a0
amounted
\u00a0
to NOK 3.6
\u00a0
billion
\u00a0
(NOK 1.2
\u00a0
billion in
\u00a0
Digi, NOK
\u00a0
1.6 billion
\u00a0
in
Grameenphone and NOK 0.7 billion in dtac).
\u00a0
During 2021,
\u00a0
dividends
\u00a0
paid to non-controlling
\u00a0
interests
\u00a0
in subsidiaries
\u00a0
amounted to
\u00a0
NOK 3.2
\u00a0
billion (NOK
\u00a0
1.5 billion
\u00a0
in Digi,
\u00a0
NOK 1.1 billion
\u00a0
in
Grameenphone and NOK 0.6 billion in dtac).
Accounting policies
Earnings per share (EPS) is the amount of
\u00a0
profit generated for the financial year attributable
\u00a0
to equity shareholders divided by the weighted
average ordinary outstanding shares.
Net income to equity holders of Telenor ASA
NOK in millions
2022
2021
Net income
\u00a0
from continuing
\u00a0
operations
10 980
5 651
Net income
\u00a0
(loss) from
\u00a0
discontinued
\u00a0
operations
33 932
(4 123)
Net income
\u00a0
from total
\u00a0
operations
44 913
1 528
NOTE 12
Held for sale and discontinued operations
In 2022, the merger between Digi and Celcom in Malaysia took place
\u00a0
and Telenor got diluted and Digi was
deconsolidated as a subsidiary. For historical periods Digi has been
\u00a0
re-presented as discontinued operations.
\u00a0
After
the transaction, Telenor owns 33.1 percent of Digi which is presented
\u00a0
as an associated company of Telenor, see
note 35. Other entities presented as held for sale and discontinued
\u00a0
operations include Myanmar which was sold in
March 2022 and Telenor India, which was disposed in 2018.
Accounting policies
\u00a0
Non-current
\u00a0
assets and
\u00a0
disposal
\u00a0
groups are
\u00a0
classified
\u00a0
as held for
\u00a0
sale if their
\u00a0
carrying
\u00a0
amounts will
\u00a0
be recovered
\u00a0
principally
\u00a0
through sale
\u00a0
rather than
continuing
\u00a0
use. This
\u00a0
also applies
\u00a0
for situations
\u00a0
where the
\u00a0
Group continues
\u00a0
its operations
\u00a0
but loses
\u00a0
control over
\u00a0
the operation.
\u00a0
Non-current
\u00a0
assets
and disposal
\u00a0
groups classified
\u00a0
as held for
\u00a0
sale are
\u00a0
measured
\u00a0
at the lower
\u00a0
of their
\u00a0
carrying
\u00a0
amount and
\u00a0
fair value
\u00a0
less cost
\u00a0
to sell and
\u00a0
presented
separately
\u00a0
as assets
\u00a0
held for
\u00a0
sale and
\u00a0
liabilities
\u00a0
held for
\u00a0
sale in the
\u00a0
statement
\u00a0
of financial
\u00a0
position.
The criteria
\u00a0
for held
\u00a0
for sale classification
\u00a0
is regarded
\u00a0
as met only
\u00a0
when the sale
\u00a0
is highly
\u00a0
probable,
\u00a0
and the asset
\u00a0
or disposal
\u00a0
group is
\u00a0
available
\u00a0
for
immediate sale in its present condition. Actions required
\u00a0
to complete the sale should indicate that
\u00a0
it is unlikely that significant changes to the plan
will be
\u00a0
made or
\u00a0
that the plan
\u00a0
to sell will
\u00a0
be withdrawn.
\u00a0
In addition,
\u00a0
management
\u00a0
must be committed
\u00a0
to the plan,
\u00a0
and must
\u00a0
be expected
\u00a0
that the sale
will be completed within a year.
Property,
\u00a0
plant and
\u00a0
equipment
\u00a0
and intangible
\u00a0
assets are
\u00a0
not depreciated
\u00a0
or amortised
\u00a0
once classified
\u00a0
as held
\u00a0
for sale.
\u00a0
The equity
\u00a0
method is
discontinued
\u00a0
for associated
\u00a0
companies
\u00a0
classified
\u00a0
as held for
\u00a0
sale.
A disposal group qualifies as discontinued operation if
\u00a0
it is a cash generating unit that
\u00a0
has either been disposed of, or is
\u00a0
classified as held for sale,
and represent
\u00a0
a separate
\u00a0
major line
\u00a0
of business
\u00a0
or geographical
\u00a0
area of operations.
\u00a0
Discontinued
\u00a0
operations
\u00a0
are excluded
\u00a0
from the results
\u00a0
of
continuing
\u00a0
operations
\u00a0
and are
\u00a0
presented
\u00a0
as a single
\u00a0
amount as
\u00a0
profit or
\u00a0
loss after
\u00a0
tax from
\u00a0
discontinued
\u00a0
operations
\u00a0
in the income
\u00a0
statement.
Discontinued operations are also excluded from segment reporting.
\u00a0
All consolidation procedures are still applicable, and
\u00a0
only external revenues
and expenses
\u00a0
are shown
\u00a0
as discontinued
\u00a0
operations.
Discontinued
\u00a0
operations and
\u00a0
assets held for
\u00a0
sale
Digi
On 30 November 2022, the merger of
\u00a0
the telecommunication operations of Celcom and Digi
\u00a0
in Malaysia was completed. The new company is
named CelcomDigi. On completion, Digi issued 3.96 billion
\u00a0
shares to Axiata in addition to a cash
\u00a0
payment of NOK 5.4 billion. The share issue diluted
Telenor\u2019s ownership to 32.47% and Telenor lost
\u00a0
control over Digi and Digi was deconsolidated and
\u00a0
recognised as an associated company as of
\u00a0
30
November
\u00a0
2022. As
\u00a0
part of the
\u00a0
transaction
\u00a0
to bring
\u00a0
Telenor and
\u00a0
Axiata to
\u00a0
equal ownership,
\u00a0
Telenor
\u00a0
acquired
\u00a0
at the same
\u00a0
date 73.4
\u00a0
million shares
from Axiata
\u00a0
for an amount
\u00a0
of NOK 667
\u00a0
million. Telenor\u2019s
\u00a0
ownership
\u00a0
after the
\u00a0
transaction
\u00a0
is 33.1%
\u00a0
and CelcomDigi
\u00a0
is accounted
\u00a0
for as an
\u00a0
associated
company.
The gain
\u00a0
recognised
\u00a0
on the date
\u00a0
of losing
\u00a0
control over
\u00a0
Digi amounts
\u00a0
to NOK 32.7
\u00a0
billion. The
\u00a0
gain was
\u00a0
based on a
\u00a0
market value
\u00a0
of the combined
entity
\u00a0
as of opening 1 December 2022, which
\u00a0
was NOK 34.1 billion for Telenor\u2019s interest
\u00a0
in the new company CelcomDigi. Due to CelcomDigi
\u00a0
being a
listed company and have not yet published
\u00a0
their fourth quarter 2022 result, the gain is
\u00a0
combined with the net income from Digi for
\u00a0
the period
October and
\u00a0
November
\u00a0
2022. A
\u00a0
gain of NOK
\u00a0
450 million
\u00a0
related to
\u00a0
cumulative
\u00a0
translation
\u00a0
differences
\u00a0
and a loss
\u00a0
of NOK 233
\u00a0
million related
\u00a0
to net
investment hedge items, previously recognised in other comprehensive
\u00a0
income, have been reclassified and included in
\u00a0
the gain calculation. The
success fee
\u00a0
to advisors
\u00a0
of NOK 155
\u00a0
million has
\u00a0
been included
\u00a0
in the gain
\u00a0
calculation.
Prior to closing of the transaction, Digi
\u00a0
obtained funds through external borrowings to finance the
\u00a0
cash payment to Axiata. This is reflected as
\u00a0
a
significant cash inflow in Telenor\u2019s consolidated cash flow
\u00a0
as financing activities. As Telenor lost control
\u00a0
in Digi, the cash balance is derecognised
under investing activities in the cash flow
\u00a0
statement. The derecognised cash balance of NOK
\u00a0
6.4 billion includes the funding for payment to
\u00a0
Axiata
The historical profit (loss) for Digi presented as
\u00a0
discontinued operation are as follows:
NOK in millions
2022
2021
Revenue
12 362
13 088
EBITDA
6 026
6 473
EBIT
3 586
3 851
Profit (loss) before tax
3 136
3 361
Income taxes
(1 004)
( 731)
Profit (loss) after tax
2 132
2 630
Gain (loss)
\u00a0
on disposal
\u00a0
after tax
32 652
-
Profit (loss) from discontinued operations - attributable to equity holders
\u00a0
of Telenor ASA
34 784
2 630
On 8 July
\u00a0
2021, Telenor
\u00a0
Group entered
\u00a0
into an agreement
\u00a0
with M1 Group
\u00a0
to sell
its mobile
\u00a0
operations
a total
consideration of USD 105 million (approximately NOK
\u00a0
920 million), of which USD 55 million
\u00a0
(approximately NOK 480 million) as deferred payment
The transaction corresponded
\u00a0
to an implied enterprise value of approximately
\u00a0
USD 600 million (approximately NOK
\u00a0
5.2 billion). On
25 March 2022, Telenor completed the sale of
\u00a0
Telenor Myanmar following the regulatory approval given
\u00a0
17 March 2022. In line with the sales
\u00a0
and
purchase
\u00a0
agreement,
\u00a0
Telenor
\u00a0
received
\u00a0
USD 50 million
\u00a0
(NOK 0.5
\u00a0
billion) at
\u00a0
closing and
\u00a0
paid USD
\u00a0
4 million as
\u00a0
transaction
\u00a0
cost. In
\u00a0
the third
\u00a0
quarter
2022 Telenor
\u00a0
received
\u00a0
USD 28 million
\u00a0
(NOK 0.3
\u00a0
billion)
\u00a0
from M1 Group
\u00a0
as a final
\u00a0
settlement
\u00a0
of the transaction,
\u00a0
which represented
\u00a0
the present
\u00a0
value
of the remaining USD 55 million deferred
\u00a0
payment. The received deferred payment was recognised in the third
\u00a0
quarter of 2022. The transaction has
impacted the equity of Telenor Group positively with
\u00a0
NOK 0.2 billion. However, the reclassification of
\u00a0
accumulated losses related to translation
differences earlier recognised in other comprehensive income
\u00a0
impacted the income statement negatively with approximately
\u00a0
NOK 0.8 billion,
resulted in a net loss on disposal
\u00a0
of NOK 0.6 billion. The derecognition of the
\u00a0
cash balance in Telenor Myanmar and the total
\u00a0
proceeds received have
resulted
\u00a0
in a net
\u00a0
negative
\u00a0
cash flow
\u00a0
impact of
\u00a0
around NOK
\u00a0
1.4 billion
\u00a0
in 2022.
Telenor Myanmar was with effect from the second
\u00a0
quarter 2021 presented as assets held for
\u00a0
sale and discontinued operations.
The profit (loss) for Telenor Myanmar presented
\u00a0
as discontinued operation are as follows:
NOK in millions
2022
2021
Revenue
1 018
4 835
EBITDA
617
2 751
EBIT
617
(5 743)
Profit (loss) before tax
602
(6 185)
Income taxes
( 50)
( 53)
Profit (loss) after tax
553
(6 238)
Gain (loss)
\u00a0
on disposal
\u00a0
after tax
( 589)
-
Profit (loss) from discontinued operations - attributable to equity holders
\u00a0
of Telenor ASA
( 36)
(6 238)
Telenor India
On 23 February 2017, the Group entered
\u00a0
into an agreement with Bharti Airtel Limited (Airtel),
\u00a0
whereby Airtel would take full ownership of Telenor
India. The transaction was completed 14 May
\u00a0
2018. The exposure to claims related to
\u00a0
the period Telenor owned the business remains
\u00a0
with Telenor.
A guarantee to Airtel was recognised at
\u00a0
fair value as of closing date of the transaction,
\u00a0
and subsequent changes to the estimate are
\u00a0
recognised on
the discontinued
\u00a0
operations
\u00a0
line in the
\u00a0
income statement.
\u00a0
During 2022,
\u00a0
an additional
\u00a0
provision
\u00a0
of NOK 0.9
\u00a0
billion plus
\u00a0
interests was
\u00a0
recognised
following reassessment of the demand from Department
\u00a0
of Telecommunication (DoT). See note 23 for further information
\u00a0
regarding the disputed
amount and
\u00a0
note 40
\u00a0
for payments
\u00a0
made after
\u00a0
31 December
\u00a0
2022.
Summary all disposal groups
The profit (loss) of all disposal groups including
\u00a0
Digi and Telenor Myanmar presented as discontinued
\u00a0
operations until disposal, and subsequent
adjustments:
NOK in millions
2022
2021
Revenue
13 380
17 923
EBITDA
6 643
9 223
EBIT
4 203
(1 892)
Profit (loss) before tax
3 738
(2 823)
Income taxes
(1 054)
( 785)
Profit (loss) after tax
2 684
(3 608)
Gain (loss)
\u00a0
on disposal
\u00a0
after tax
31 248
( 515)
Profit (loss) from discontinued operations - attributable to equity holders
\u00a0
of Telenor ASA
33 932
(4 123)
The gain on disposal recognised during 2022
\u00a0
are mainly related to Digi which is offset
\u00a0
by additional provision and accrual of interest on
\u00a0
existing
Adjusted Gross Revenue (AGR) provision against demand
\u00a0
from Department of Telecommunication (DoT) in India
\u00a0
and losses from Telenor Myanmar.
The losses on disposal recognised during 2021
\u00a0
was mainly related to Telenor India.
\u00a0
Cashflow related to discontinued operations presented below
\u00a0
are from external transactions. Hence, the cash flows
\u00a0
for discontinued operations do
not reflect
\u00a0
these operations
\u00a0
as if they
\u00a0
were standalone
\u00a0
entities.
NOK in millions
2022
2021
Digi
Myanmar
Total
Digi
Myanmar
Total
Net cash flow
\u00a0
from operating
\u00a0
activities
5 451
612
6 063
5 557
2 574
8 130
Net cash flow from investing activities
(7 802)
(2 122)
(9 925)
(1 465)
( 256)
(1 721)
Net cash flow
\u00a0
from financing
\u00a0
activities
2 922
( 186)
2 736
(2 912)
( 981)
(3 893)
Total cash flows from discontinued operations
570
(1 697)
(1 126)
1 179
1 337
2 516
Effects of
\u00a0
exchange
\u00a0
rate changes
\u00a0
on cash and
\u00a0
cash equivalents
38
1
38
23
( 229)
( 207)
Net cash flows from discontinued operations
608
(1 696)
(1 088)
1 201
1 108
2 309
The major
\u00a0
classes of
\u00a0
liabilities
\u00a0
of the disposal
\u00a0
groups classified
\u00a0
as held
\u00a0
for sale as
\u00a0
of 31 December
\u00a0
2022 represents
\u00a0
Telenor
\u00a0
India with
\u00a0
a provision
\u00a0
of
NOK 4.7 billion.
\u00a0
As of 31
\u00a0
December
\u00a0
2021, assets
\u00a0
held for
\u00a0
sale of NOK
\u00a0
2.2 billion
\u00a0
relates to
\u00a0
Telenor Myanmar
\u00a0
and remaining
\u00a0
NOK 0.7 billion
\u00a0
relates to
Open Universe. Liabilities held for sale includes NOK 2.1
\u00a0
billion related to Telenor Myanmar and NOK
\u00a0
3.4 billion representing the provision for Telenor
India:
NOK in millions
Assets
Property, plant and equipment
-
717
Inventory
-
13
Trade and other receivables
-
317
Cash and
\u00a0
cash equivalents
-
1 863
Total assets classified as held for sale
-
2 910
Liabilities
Non-current liabilities
-
23
Current liabilities
4 735
5 557
Total liabilities
\u00a0
held for
\u00a0
sale
4 735
5 580
Accumulated
\u00a0
amounts recognised
\u00a0
in Other
\u00a0
comprehensive
\u00a0
income
The accumulated amounts for discontinued operations recognised
\u00a0
in Other comprehensive income within Equity are
\u00a0
as follows:
NOK in millions
2022
2021
Digi
-
361
Telenor Myanmar
-
( 802)
Telenor India
( 652)
( 180)
( 652)
( 621)
NOTE 12
Held for sale and discontinued operations
In 2022, the merger between Digi and Celcom in Malaysia took place
\u00a0
and Telenor got diluted and Digi was
deconsolidated as a subsidiary. For historical periods Digi has been
\u00a0
re-presented as discontinued operations.
\u00a0
After
the transaction, Telenor owns 33.1 percent of Digi which is presented
\u00a0
as an associated company of Telenor, see
note 35. Other entities presented as held for sale and discontinued
\u00a0
operations include Myanmar which was sold in
March 2022 and Telenor India, which was disposed in 2018.
Accounting policies
\u00a0
Non-current
\u00a0
assets and
\u00a0
disposal
\u00a0
groups are
\u00a0
classified
\u00a0
as held for
\u00a0
sale if their
\u00a0
carrying
\u00a0
amounts will
\u00a0
be recovered
\u00a0
principally
\u00a0
through sale
\u00a0
rather than
continuing
\u00a0
use. This
\u00a0
also applies
\u00a0
for situations
\u00a0
where the
\u00a0
Group continues
\u00a0
its operations
\u00a0
but loses
\u00a0
control over
\u00a0
the operation.
\u00a0
Non-current
\u00a0
assets
and disposal
\u00a0
groups classified
\u00a0
as held for
\u00a0
sale are
\u00a0
measured
\u00a0
at the lower
\u00a0
of their
\u00a0
carrying
\u00a0
amount and
\u00a0
fair value
\u00a0
less cost
\u00a0
to sell and
\u00a0
presented
separately
\u00a0
as assets
\u00a0
held for
\u00a0
sale and
\u00a0
liabilities
\u00a0
held for
\u00a0
sale in the
\u00a0
statement
\u00a0
of financial
\u00a0
position.
The criteria
\u00a0
for held
\u00a0
for sale classification
\u00a0
is regarded
\u00a0
as met only
\u00a0
when the sale
\u00a0
is highly
\u00a0
probable,
\u00a0
and the asset
\u00a0
or disposal
\u00a0
group is
\u00a0
available
\u00a0
for
immediate sale in its present condition. Actions required
\u00a0
to complete the sale should indicate that
\u00a0
it is unlikely that significant changes to the plan
will be
\u00a0
made or
\u00a0
that the plan
\u00a0
to sell will
\u00a0
be withdrawn.
\u00a0
In addition,
\u00a0
management
\u00a0
must be committed
\u00a0
to the plan,
\u00a0
and must
\u00a0
be expected
\u00a0
that the sale
will be completed within a year.
Property,
\u00a0
plant and
\u00a0
equipment
\u00a0
and intangible
\u00a0
assets are
\u00a0
not depreciated
\u00a0
or amortised
\u00a0
once classified
\u00a0
as held
\u00a0
for sale.
\u00a0
The equity
\u00a0
method is
discontinued
\u00a0
for associated
\u00a0
companies
\u00a0
classified
\u00a0
as held for
\u00a0
sale.
A disposal group qualifies as discontinued operation if
\u00a0
it is a cash generating unit that
\u00a0
has either been disposed of, or is
\u00a0
classified as held for sale,
and represent
\u00a0
a separate
\u00a0
major line
\u00a0
of business
\u00a0
or geographical
\u00a0
area of operations.
\u00a0
Discontinued
\u00a0
operations
\u00a0
are excluded
\u00a0
from the results
\u00a0
of
continuing
\u00a0
operations
\u00a0
and are
\u00a0
presented
\u00a0
as a single
\u00a0
amount as
\u00a0
profit or
\u00a0
loss after
\u00a0
tax from
\u00a0
discontinued
\u00a0
operations
\u00a0
in the income
\u00a0
statement.
Discontinued operations are also excluded from segment reporting.
\u00a0
All consolidation procedures are still applicable, and
\u00a0
only external revenues
and expenses
\u00a0
are shown
\u00a0
as discontinued
\u00a0
operations.
Discontinued
\u00a0
operations and
\u00a0
assets held for
\u00a0
sale
Digi
On 30 November 2022, the merger of
\u00a0
the telecommunication operations of Celcom and Digi
\u00a0
in Malaysia was completed. The new company is
named CelcomDigi. On completion, Digi issued 3.96 billion
\u00a0
shares to Axiata in addition to a cash
\u00a0
payment of NOK 5.4 billion. The share issue diluted
Telenor\u2019s ownership to 32.47% and Telenor lost
\u00a0
control over Digi and Digi was deconsolidated and
\u00a0
recognised as an associated company as of
\u00a0
30
November
\u00a0
2022. As
\u00a0
part of the
\u00a0
transaction
\u00a0
to bring
\u00a0
Telenor and
\u00a0
Axiata to
\u00a0
equal ownership,
\u00a0
Telenor
\u00a0
acquired
\u00a0
at the same
\u00a0
date 73.4
\u00a0
million shares
from Axiata
\u00a0
for an amount
\u00a0
of NOK 667
\u00a0
million. Telenor\u2019s
\u00a0
ownership
\u00a0
after the
\u00a0
transaction
\u00a0
is 33.1%
\u00a0
and CelcomDigi
\u00a0
is accounted
\u00a0
for as an
\u00a0
associated
company.
The gain
\u00a0
recognised
\u00a0
on the date
\u00a0
of losing
\u00a0
control over
\u00a0
Digi amounts
\u00a0
to NOK 32.7
\u00a0
billion. The
\u00a0
gain was
\u00a0
based on a
\u00a0
market value
\u00a0
of the combined
entity
\u00a0
as of opening 1 December 2022, which
\u00a0
was NOK 34.1 billion for Telenor\u2019s interest
\u00a0
in the new company CelcomDigi. Due to CelcomDigi
\u00a0
being a
listed company and have not yet published
\u00a0
their fourth quarter 2022 result, the gain is
\u00a0
combined with the net income from Digi for
\u00a0
the period
October and
\u00a0
November
\u00a0
2022. A
\u00a0
gain of NOK
\u00a0
450 million
\u00a0
related to
\u00a0
cumulative
\u00a0
translation
\u00a0
differences
\u00a0
and a loss
\u00a0
of NOK 233
\u00a0
million related
\u00a0
to net
investment hedge items, previously recognised in other comprehensive
\u00a0
income, have been reclassified and included in
\u00a0
the gain calculation. The
success fee
\u00a0
to advisors
\u00a0
of NOK 155
\u00a0
million has
\u00a0
been included
\u00a0
in the gain
\u00a0
calculation.
Prior to closing of the transaction, Digi
\u00a0
obtained funds through external borrowings to finance the
\u00a0
cash payment to Axiata. This is reflected as
\u00a0
a
significant cash inflow in Telenor\u2019s consolidated cash flow
\u00a0
as financing activities. As Telenor lost control
\u00a0
in Digi, the cash balance is derecognised
under investing activities in the cash flow
\u00a0
statement. The derecognised cash balance of NOK
\u00a0
6.4 billion includes the funding for payment to
\u00a0
Axiata
The historical profit (loss) for Digi presented as
\u00a0
discontinued operation are as follows:
NOK in millions
2022
2021
Revenue
12 362
13 088
EBITDA
6 026
6 473
EBIT
3 586
3 851
Profit (loss) before tax
3 136
3 361
Income taxes
(1 004)
( 731)
Profit (loss) after tax
2 132
2 630
Gain (loss)
\u00a0
on disposal
\u00a0
after tax
32 652
-
Profit (loss) from discontinued operations - attributable to equity holders
\u00a0
of Telenor ASA
34 784
2 630
On 8 July
\u00a0
2021, Telenor
\u00a0
Group entered
\u00a0
into an agreement
\u00a0
with M1 Group
\u00a0
to sell
its mobile
\u00a0
operations
a total
consideration of USD 105 million (approximately NOK
\u00a0
920 million), of which USD 55 million
\u00a0
(approximately NOK 480 million) as deferred payment
The transaction corresponded
\u00a0
to an implied enterprise value of approximately
\u00a0
USD 600 million (approximately NOK
\u00a0
5.2 billion). On
25 March 2022, Telenor completed the sale of
\u00a0
Telenor Myanmar following the regulatory approval given
\u00a0
17 March 2022. In line with the sales
\u00a0
and
purchase
\u00a0
agreement,
\u00a0
Telenor
\u00a0
received
\u00a0
USD 50 million
\u00a0
(NOK 0.5
\u00a0
billion) at
\u00a0
closing and
\u00a0
paid USD
\u00a0
4 million as
\u00a0
transaction
\u00a0
cost. In
\u00a0
the third
\u00a0
quarter
2022 Telenor
\u00a0
received
\u00a0
USD 28 million
\u00a0
(NOK 0.3
\u00a0
billion)
\u00a0
from M1 Group
\u00a0
as a final
\u00a0
settlement
\u00a0
of the transaction,
\u00a0
which represented
\u00a0
the present
\u00a0
value
of the remaining USD 55 million deferred
\u00a0
payment. The received deferred payment was recognised in the third
\u00a0
quarter of 2022. The transaction has
impacted the equity of Telenor Group positively with
\u00a0
NOK 0.2 billion. However, the reclassification of
\u00a0
accumulated losses related to translation
differences earlier recognised in other comprehensive income
\u00a0
impacted the income statement negatively with approximately
\u00a0
NOK 0.8 billion,
resulted in a net loss on disposal
\u00a0
of NOK 0.6 billion. The derecognition of the
\u00a0
cash balance in Telenor Myanmar and the total
\u00a0
proceeds received have
resulted
\u00a0
in a net
\u00a0
negative
\u00a0
cash flow
\u00a0
impact of
\u00a0
around NOK
\u00a0
1.4 billion
\u00a0
in 2022.
Telenor Myanmar was with effect from the second
\u00a0
quarter 2021 presented as assets held for
\u00a0
sale and discontinued operations.
The profit (loss) for Telenor Myanmar presented
\u00a0
as discontinued operation are as follows:
NOK in millions
2022
2021
Revenue
1 018
4 835
EBITDA
617
2 751
EBIT
617
(5 743)
Profit (loss) before tax
602
(6 185)
Income taxes
( 50)
( 53)
Profit (loss) after tax
553
(6 238)
Gain (loss)
\u00a0
on disposal
\u00a0
after tax
( 589)
-
Profit (loss) from discontinued operations - attributable to equity holders
\u00a0
of Telenor ASA
( 36)
(6 238)
Telenor India
On 23 February 2017, the Group entered
\u00a0
into an agreement with Bharti Airtel Limited (Airtel),
\u00a0
whereby Airtel would take full ownership of Telenor
India. The transaction was completed 14 May
\u00a0
2018. The exposure to claims related to
\u00a0
the period Telenor owned the business remains
\u00a0
with Telenor.
A guarantee to Airtel was recognised at
\u00a0
fair value as of closing date of the transaction,
\u00a0
and subsequent changes to the estimate are
\u00a0
recognised on
the discontinued
\u00a0
operations
\u00a0
line in the
\u00a0
income statement.
\u00a0
During 2022,
\u00a0
an additional
\u00a0
provision
\u00a0
of NOK 0.9
\u00a0
billion plus
\u00a0
interests was
\u00a0
recognised
following reassessment of the demand from Department
\u00a0
of Telecommunication (DoT). See note 23 for further information
\u00a0
regarding the disputed
amount and
\u00a0
note 40
\u00a0
for payments
\u00a0
made after
\u00a0
31 December
\u00a0
2022.
Summary all disposal groups
The profit (loss) of all disposal groups including
\u00a0
Digi and Telenor Myanmar presented as discontinued
\u00a0
operations until disposal, and subsequent
adjustments:
NOK in millions
2022
2021
Revenue
13 380
17 923
EBITDA
6 643
9 223
EBIT
4 203
(1 892)
Profit (loss) before tax
3 738
(2 823)
Income taxes
(1 054)
( 785)
Profit (loss) after tax
2 684
(3 608)
Gain (loss)
\u00a0
on disposal
\u00a0
after tax
31 248
( 515)
Profit (loss) from discontinued operations - attributable to equity holders
\u00a0
of Telenor ASA
33 932
(4 123)
The gain on disposal recognised during 2022
\u00a0
are mainly related to Digi which is offset
\u00a0
by additional provision and accrual of interest on
\u00a0
existing
Adjusted Gross Revenue (AGR) provision against demand
\u00a0
from Department of Telecommunication (DoT) in India
\u00a0
and losses from Telenor Myanmar.
The losses on disposal recognised during 2021
\u00a0
was mainly related to Telenor India.
\u00a0
Cashflow related to discontinued operations presented below
\u00a0
are from external transactions. Hence, the cash flows
\u00a0
for discontinued operations do
not reflect
\u00a0
these operations
\u00a0
as if they
\u00a0
were standalone
\u00a0
entities.
NOK in millions
2022
2021
Digi
Myanmar
Total
Digi
Myanmar
Total
Net cash flow
\u00a0
from operating
\u00a0
activities
5 451
612
6 063
5 557
2 574
8 130
Net cash flow from investing activities
(7 802)
(2 122)
(9 925)
(1 465)
( 256)
(1 721)
Net cash flow
\u00a0
from financing
\u00a0
activities
2 922
( 186)
2 736
(2 912)
( 981)
(3 893)
Total cash flows from discontinued operations
570
(1 697)
(1 126)
1 179
1 337
2 516
Effects of
\u00a0
exchange
\u00a0
rate changes
\u00a0
on cash and
\u00a0
cash equivalents
38
1
38
23
( 229)
( 207)
Net cash flows from discontinued operations
608
(1 696)
(1 088)
1 201
1 108
2 309
The major
\u00a0
classes of
\u00a0
liabilities
\u00a0
of the disposal
\u00a0
groups classified
\u00a0
as held
\u00a0
for sale as
\u00a0
of 31 December
\u00a0
2022 represents
\u00a0
Telenor
\u00a0
India with
\u00a0
a provision
\u00a0
of
NOK 4.7 billion.
\u00a0
As of 31
\u00a0
December
\u00a0
2021, assets
\u00a0
held for
\u00a0
sale of NOK
\u00a0
2.2 billion
\u00a0
relates to
\u00a0
Telenor Myanmar
\u00a0
and remaining
\u00a0
NOK 0.7 billion
\u00a0
relates to
Open Universe. Liabilities held for sale includes NOK 2.1
\u00a0
billion related to Telenor Myanmar and NOK
\u00a0
3.4 billion representing the provision for Telenor
India:
NOK in millions
Assets
Property, plant and equipment
-
717
Inventory
-
13
Trade and other receivables
-
317
Cash and
\u00a0
cash equivalents
-
1 863
Total assets classified as held for sale
-
2 910
Liabilities
Non-current liabilities
-
23
Current liabilities
4 735
5 557
Total liabilities
\u00a0
held for
\u00a0
sale
4 735
5 580
Accumulated
\u00a0
amounts recognised
\u00a0
in Other
\u00a0
comprehensive
\u00a0
income
The accumulated amounts for discontinued operations recognised
\u00a0
in Other comprehensive income within Equity are
\u00a0
as follows:
NOK in millions
2022
2021
Digi
-
361
Telenor Myanmar
-
( 802)
Telenor India
( 652)
( 180)
( 652)
( 621)
NOTE 12
Held for sale and discontinued operations
In 2022, the merger between Digi and Celcom in Malaysia took place
\u00a0
and Telenor got diluted and Digi was
deconsolidated as a subsidiary. For historical periods Digi has been
\u00a0
re-presented as discontinued operations.
\u00a0
After
the transaction, Telenor owns 33.1 percent of Digi which is presented
\u00a0
as an associated company of Telenor, see
note 35. Other entities presented as held for sale and discontinued
\u00a0
operations include Myanmar which was sold in
March 2022 and Telenor India, which was disposed in 2018.
Accounting policies
\u00a0
Non-current
\u00a0
assets and
\u00a0
disposal
\u00a0
groups are
\u00a0
classified
\u00a0
as held for
\u00a0
sale if their
\u00a0
carrying
\u00a0
amounts will
\u00a0
be recovered
\u00a0
principally
\u00a0
through sale
\u00a0
rather than
continuing
\u00a0
use. This
\u00a0
also applies
\u00a0
for situations
\u00a0
where the
\u00a0
Group continues
\u00a0
its operations
\u00a0
but loses
\u00a0
control over
\u00a0
the operation.
\u00a0
Non-current
\u00a0
assets
and disposal
\u00a0
groups classified
\u00a0
as held for
\u00a0
sale are
\u00a0
measured
\u00a0
at the lower
\u00a0
of their
\u00a0
carrying
\u00a0
amount and
\u00a0
fair value
\u00a0
less cost
\u00a0
to sell and
\u00a0
presented
separately
\u00a0
as assets
\u00a0
held for
\u00a0
sale and
\u00a0
liabilities
\u00a0
held for
\u00a0
sale in the
\u00a0
statement
\u00a0
of financial
\u00a0
position.
The criteria
\u00a0
for held
\u00a0
for sale classification
\u00a0
is regarded
\u00a0
as met only
\u00a0
when the sale
\u00a0
is highly
\u00a0
probable,
\u00a0
and the asset
\u00a0
or disposal
\u00a0
group is
\u00a0
available
\u00a0
for
immediate sale in its present condition. Actions required
\u00a0
to complete the sale should indicate that
\u00a0
it is unlikely that significant changes to the plan
will be
\u00a0
made or
\u00a0
that the plan
\u00a0
to sell will
\u00a0
be withdrawn.
\u00a0
In addition,
\u00a0
management
\u00a0
must be committed
\u00a0
to the plan,
\u00a0
and must
\u00a0
be expected
\u00a0
that the sale
will be completed within a year.
Property,
\u00a0
plant and
\u00a0
equipment
\u00a0
and intangible
\u00a0
assets are
\u00a0
not depreciated
\u00a0
or amortised
\u00a0
once classified
\u00a0
as held
\u00a0
for sale.
\u00a0
The equity
\u00a0
method is
discontinued
\u00a0
for associated
\u00a0
companies
\u00a0
classified
\u00a0
as held for
\u00a0
sale.
A disposal group qualifies as discontinued operation if
\u00a0
it is a cash generating unit that
\u00a0
has either been disposed of, or is
\u00a0
classified as held for sale,
and represent
\u00a0
a separate
\u00a0
major line
\u00a0
of business
\u00a0
or geographical
\u00a0
area of operations.
\u00a0
Discontinued
\u00a0
operations
\u00a0
are excluded
\u00a0
from the results
\u00a0
of
continuing
\u00a0
operations
\u00a0
and are
\u00a0
presented
\u00a0
as a single
\u00a0
amount as
\u00a0
profit or
\u00a0
loss after
\u00a0
tax from
\u00a0
discontinued
\u00a0
operations
\u00a0
in the income
\u00a0
statement.
Discontinued operations are also excluded from segment reporting.
\u00a0
All consolidation procedures are still applicable, and
\u00a0
only external revenues
and expenses
\u00a0
are shown
\u00a0
as discontinued
\u00a0
operations.
Discontinued
\u00a0
operations and
\u00a0
assets held for
\u00a0
sale
Digi
On 30 November 2022, the merger of
\u00a0
the telecommunication operations of Celcom and Digi
\u00a0
in Malaysia was completed. The new company is
named CelcomDigi. On completion, Digi issued 3.96 billion
\u00a0
shares to Axiata in addition to a cash
\u00a0
payment of NOK 5.4 billion. The share issue diluted
Telenor\u2019s ownership to 32.47% and Telenor lost
\u00a0
control over Digi and Digi was deconsolidated and
\u00a0
recognised as an associated company as of
\u00a0
30
November
\u00a0
2022. As
\u00a0
part of the
\u00a0
transaction
\u00a0
to bring
\u00a0
Telenor and
\u00a0
Axiata to
\u00a0
equal ownership,
\u00a0
Telenor
\u00a0
acquired
\u00a0
at the same
\u00a0
date 73.4
\u00a0
million shares
from Axiata
\u00a0
for an amount
\u00a0
of NOK 667
\u00a0
million. Telenor\u2019s
\u00a0
ownership
\u00a0
after the
\u00a0
transaction
\u00a0
is 33.1%
\u00a0
and CelcomDigi
\u00a0
is accounted
\u00a0
for as an
\u00a0
associated
company.
The gain
\u00a0
recognised
\u00a0
on the date
\u00a0
of losing
\u00a0
control over
\u00a0
Digi amounts
\u00a0
to NOK 32.7
\u00a0
billion. The
\u00a0
gain was
\u00a0
based on a
\u00a0
market value
\u00a0
of the combined
entity
\u00a0
as of opening 1 December 2022, which
\u00a0
was NOK 34.1 billion for Telenor\u2019s interest
\u00a0
in the new company CelcomDigi. Due to CelcomDigi
\u00a0
being a
listed company and have not yet published
\u00a0
their fourth quarter 2022 result, the gain is
\u00a0
combined with the net income from Digi for
\u00a0
the period
October and
\u00a0
November
\u00a0
2022. A
\u00a0
gain of NOK
\u00a0
450 million
\u00a0
related to
\u00a0
cumulative
\u00a0
translation
\u00a0
differences
\u00a0
and a loss
\u00a0
of NOK 233
\u00a0
million related
\u00a0
to net
investment hedge items, previously recognised in other comprehensive
\u00a0
income, have been reclassified and included in
\u00a0
the gain calculation. The
success fee
\u00a0
to advisors
\u00a0
of NOK 155
\u00a0
million has
\u00a0
been included
\u00a0
in the gain
\u00a0
calculation.
Prior to closing of the transaction, Digi
\u00a0
obtained funds through external borrowings to finance the
\u00a0
cash payment to Axiata. This is reflected as
\u00a0
a
significant cash inflow in Telenor\u2019s consolidated cash flow
\u00a0
as financing activities. As Telenor lost control
\u00a0
in Digi, the cash balance is derecognised
under investing activities in the cash flow
\u00a0
statement. The derecognised cash balance of NOK
\u00a0
6.4 billion includes the funding for payment to
\u00a0
Axiata
The historical profit (loss) for Digi presented as
\u00a0
discontinued operation are as follows:
NOK in millions
2022
2021
Revenue
12 362
13 088
EBITDA
6 026
6 473
EBIT
3 586
3 851
Profit (loss) before tax
3 136
3 361
Income taxes
(1 004)
( 731)
Profit (loss) after tax
2 132
2 630
Gain (loss)
\u00a0
on disposal
\u00a0
after tax
32 652
-
Profit (loss) from discontinued operations - attributable to equity holders
\u00a0
of Telenor ASA
34 784
2 630
On 8 July
\u00a0
2021, Telenor
\u00a0
Group entered
\u00a0
into an agreement
\u00a0
with M1 Group
\u00a0
to sell
its mobile
\u00a0
operations
a total
consideration of USD 105 million (approximately NOK
\u00a0
920 million), of which USD 55 million
\u00a0
(approximately NOK 480 million) as deferred payment
The transaction corresponded
\u00a0
to an implied enterprise value of approximately
\u00a0
USD 600 million (approximately NOK
\u00a0
5.2 billion). On
25 March 2022, Telenor completed the sale of
\u00a0
Telenor Myanmar following the regulatory approval given
\u00a0
17 March 2022. In line with the sales
\u00a0
and
purchase
\u00a0
agreement,
\u00a0
Telenor
\u00a0
received
\u00a0
USD 50 million
\u00a0
(NOK 0.5
\u00a0
billion) at
\u00a0
closing and
\u00a0
paid USD
\u00a0
4 million as
\u00a0
transaction
\u00a0
cost. In
\u00a0
the third
\u00a0
quarter
2022 Telenor
\u00a0
received
\u00a0
USD 28 million
\u00a0
(NOK 0.3
\u00a0
billion)
\u00a0
from M1 Group
\u00a0
as a final
\u00a0
settlement
\u00a0
of the transaction,
\u00a0
which represented
\u00a0
the present
\u00a0
value
of the remaining USD 55 million deferred
\u00a0
payment. The received deferred payment was recognised in the third
\u00a0
quarter of 2022. The transaction has
impacted the equity of Telenor Group positively with
\u00a0
NOK 0.2 billion. However, the reclassification of
\u00a0
accumulated losses related to translation
differences earlier recognised in other comprehensive income
\u00a0
impacted the income statement negatively with approximately
\u00a0
NOK 0.8 billion,
resulted in a net loss on disposal
\u00a0
of NOK 0.6 billion. The derecognition of the
\u00a0
cash balance in Telenor Myanmar and the total
\u00a0
proceeds received have
resulted
\u00a0
in a net
\u00a0
negative
\u00a0
cash flow
\u00a0
impact of
\u00a0
around NOK
\u00a0
1.4 billion
\u00a0
in 2022.
Telenor Myanmar was with effect from the second
\u00a0
quarter 2021 presented as assets held for
\u00a0
sale and discontinued operations.
The profit (loss) for Telenor Myanmar presented
\u00a0
as discontinued operation are as follows:
NOK in millions
2022
2021
Revenue
1 018
4 835
EBITDA
617
2 751
EBIT
617
(5 743)
Profit (loss) before tax
602
(6 185)
Income taxes
( 50)
( 53)
Profit (loss) after tax
553
(6 238)
Gain (loss)
\u00a0
on disposal
\u00a0
after tax
( 589)
-
Profit (loss) from discontinued operations - attributable to equity holders
\u00a0
of Telenor ASA
( 36)
(6 238)
Telenor India
On 23 February 2017, the Group entered
\u00a0
into an agreement with Bharti Airtel Limited (Airtel),
\u00a0
whereby Airtel would take full ownership of Telenor
India. The transaction was completed 14 May
\u00a0
2018. The exposure to claims related to
\u00a0
the period Telenor owned the business remains
\u00a0
with Telenor.
A guarantee to Airtel was recognised at
\u00a0
fair value as of closing date of the transaction,
\u00a0
and subsequent changes to the estimate are
\u00a0
recognised on
the discontinued
\u00a0
operations
\u00a0
line in the
\u00a0
income statement.
\u00a0
During 2022,
\u00a0
an additional
\u00a0
provision
\u00a0
of NOK 0.9
\u00a0
billion plus
\u00a0
interests was
\u00a0
recognised
following reassessment of the demand from Department
\u00a0
of Telecommunication (DoT). See note 23 for further information
\u00a0
regarding the disputed
amount and
\u00a0
note 40
\u00a0
for payments
\u00a0
made after
\u00a0
31 December
\u00a0
2022.
Summary all disposal groups
The profit (loss) of all disposal groups including
\u00a0
Digi and Telenor Myanmar presented as discontinued
\u00a0
operations until disposal, and subsequent
adjustments:
NOK in millions
2022
2021
Revenue
13 380
17 923
EBITDA
6 643
9 223
EBIT
4 203
(1 892)
Profit (loss) before tax
3 738
(2 823)
Income taxes
(1 054)
( 785)
Profit (loss) after tax
2 684
(3 608)
Gain (loss)
\u00a0
on disposal
\u00a0
after tax
31 248
( 515)
Profit (loss) from discontinued operations - attributable to equity holders
\u00a0
of Telenor ASA
33 932
(4 123)
The gain on disposal recognised during 2022
\u00a0
are mainly related to Digi which is offset
\u00a0
by additional provision and accrual of interest on
\u00a0
existing
Adjusted Gross Revenue (AGR) provision against demand
\u00a0
from Department of Telecommunication (DoT) in India
\u00a0
and losses from Telenor Myanmar.
The losses on disposal recognised during 2021
\u00a0
was mainly related to Telenor India.
\u00a0
Cashflow related to discontinued operations presented below
\u00a0
are from external transactions. Hence, the cash flows
\u00a0
for discontinued operations do
not reflect
\u00a0
these operations
\u00a0
as if they
\u00a0
were standalone
\u00a0
entities.
NOK in millions
2022
2021
Digi
Myanmar
Total
Digi
Myanmar
Total
Net cash flow
\u00a0
from operating
\u00a0
activities
5 451
612
6 063
5 557
2 574
8 130
Net cash flow from investing activities
(7 802)
(2 122)
(9 925)
(1 465)
( 256)
(1 721)
Net cash flow
\u00a0
from financing
\u00a0
activities
2 922
( 186)
2 736
(2 912)
( 981)
(3 893)
Total cash flows from discontinued operations
570
(1 697)
(1 126)
1 179
1 337
2 516
Effects of
\u00a0
exchange
\u00a0
rate changes
\u00a0
on cash and
\u00a0
cash equivalents
38
1
38
23
( 229)
( 207)
Net cash flows from discontinued operations
608
(1 696)
(1 088)
1 201
1 108
2 309
The major
\u00a0
classes of
\u00a0
liabilities
\u00a0
of the disposal
\u00a0
groups classified
\u00a0
as held
\u00a0
for sale as
\u00a0
of 31 December
\u00a0
2022 represents
\u00a0
Telenor
\u00a0
India with
\u00a0
a provision
\u00a0
of
NOK 4.7 billion.
\u00a0
As of 31
\u00a0
December
\u00a0
2021, assets
\u00a0
held for
\u00a0
sale of NOK
\u00a0
2.2 billion
\u00a0
relates to
\u00a0
Telenor Myanmar
\u00a0
and remaining
\u00a0
NOK 0.7 billion
\u00a0
relates to
Open Universe. Liabilities held for sale includes NOK 2.1
\u00a0
billion related to Telenor Myanmar and NOK
\u00a0
3.4 billion representing the provision for Telenor
India:
NOK in millions
Assets
Property, plant and equipment
-
717
Inventory
-
13
Trade and other receivables
-
317
Cash and
\u00a0
cash equivalents
-
1 863
Total assets classified as held for sale
-
2 910
Liabilities
Non-current liabilities
-
23
Current liabilities
4 735
5 557
Total liabilities
\u00a0
held for
\u00a0
sale
4 735
5 580
Accumulated
\u00a0
amounts recognised
\u00a0
in Other
\u00a0
comprehensive
\u00a0
income
The accumulated amounts for discontinued operations recognised
\u00a0
in Other comprehensive income within Equity are
\u00a0
as follows:
NOK in millions
2022
2021
Digi
-
361
Telenor Myanmar
-
( 802)
Telenor India
( 652)
( 180)
( 652)
( 621)
Accounting policies
\u00a0
Non-current
\u00a0
assets and
\u00a0
disposal
\u00a0
groups are
\u00a0
classified
\u00a0
as held for
\u00a0
sale if their
\u00a0
carrying
\u00a0
amounts will
\u00a0
be recovered
\u00a0
principally
\u00a0
through sale
\u00a0
rather than
continuing
\u00a0
use. This
\u00a0
also applies
\u00a0
for situations
\u00a0
where the
\u00a0
Group continues
\u00a0
its operations
\u00a0
but loses
\u00a0
control over
\u00a0
the operation.
\u00a0
Non-current
\u00a0
assets
and disposal
\u00a0
groups classified
\u00a0
as held for
\u00a0
sale are
\u00a0
measured
\u00a0
at the lower
\u00a0
of their
\u00a0
carrying
\u00a0
amount and
\u00a0
fair value
\u00a0
less cost
\u00a0
to sell and
\u00a0
presented
separately
\u00a0
as assets
\u00a0
held for
\u00a0
sale and
\u00a0
liabilities
\u00a0
held for
\u00a0
sale in the
\u00a0
statement
\u00a0
of financial
\u00a0
position.
The criteria
\u00a0
for held
\u00a0
for sale classification
\u00a0
is regarded
\u00a0
as met only
\u00a0
when the sale
\u00a0
is highly
\u00a0
probable,
\u00a0
and the asset
\u00a0
or disposal
\u00a0
group is
\u00a0
available
\u00a0
for
immediate sale in its present condition. Actions required
\u00a0
to complete the sale should indicate that
\u00a0
it is unlikely that significant changes to the plan
will be
\u00a0
made or
\u00a0
that the plan
\u00a0
to sell will
\u00a0
be withdrawn.
\u00a0
In addition,
\u00a0
management
\u00a0
must be committed
\u00a0
to the plan,
\u00a0
and must
\u00a0
be expected
\u00a0
that the sale
will be completed within a year.
Property,
\u00a0
plant and
\u00a0
equipment
\u00a0
and intangible
\u00a0
assets are
\u00a0
not depreciated
\u00a0
or amortised
\u00a0
once classified
\u00a0
as held
\u00a0
for sale.
\u00a0
The equity
\u00a0
method is
discontinued
\u00a0
for associated
\u00a0
companies
\u00a0
classified
\u00a0
as held for
\u00a0
sale.
A disposal group qualifies as discontinued operation if
\u00a0
it is a cash generating unit that
\u00a0
has either been disposed of, or is
\u00a0
classified as held for sale,
and represent
\u00a0
a separate
\u00a0
major line
\u00a0
of business
\u00a0
or geographical
\u00a0
area of operations.
\u00a0
Discontinued
\u00a0
operations
\u00a0
are excluded
\u00a0
from the results
\u00a0
of
continuing
\u00a0
operations
\u00a0
and are
\u00a0
presented
\u00a0
as a single
\u00a0
amount as
\u00a0
profit or
\u00a0
loss after
\u00a0
tax from
\u00a0
discontinued
\u00a0
operations
\u00a0
in the income
\u00a0
statement.
Discontinued operations are also excluded from segment reporting.
\u00a0
All consolidation procedures are still applicable, and
\u00a0
only external revenues
and expenses
\u00a0
are shown
\u00a0
as discontinued
\u00a0
operations.
Accounting policies
\u00a0
Non-current
\u00a0
assets and
\u00a0
disposal
\u00a0
groups are
\u00a0
classified
\u00a0
as held for
\u00a0
sale if their
\u00a0
carrying
\u00a0
amounts will
\u00a0
be recovered
\u00a0
principally
\u00a0
through sale
\u00a0
rather than
continuing
\u00a0
use. This
\u00a0
also applies
\u00a0
for situations
\u00a0
where the
\u00a0
Group continues
\u00a0
its operations
\u00a0
but loses
\u00a0
control over
\u00a0
the operation.
\u00a0
Non-current
\u00a0
assets
and disposal
\u00a0
groups classified
\u00a0
as held for
\u00a0
sale are
\u00a0
measured
\u00a0
at the lower
\u00a0
of their
\u00a0
carrying
\u00a0
amount and
\u00a0
fair value
\u00a0
less cost
\u00a0
to sell and
\u00a0
presented
separately
\u00a0
as assets
\u00a0
held for
\u00a0
sale and
\u00a0
liabilities
\u00a0
held for
\u00a0
sale in the
\u00a0
statement
\u00a0
of financial
\u00a0
position.
The criteria
\u00a0
for held
\u00a0
for sale classification
\u00a0
is regarded
\u00a0
as met only
\u00a0
when the sale
\u00a0
is highly
\u00a0
probable,
\u00a0
and the asset
\u00a0
or disposal
\u00a0
group is
\u00a0
available
\u00a0
for
immediate sale in its present condition. Actions required
\u00a0
to complete the sale should indicate that
\u00a0
it is unlikely that significant changes to the plan
will be
\u00a0
made or
\u00a0
that the plan
\u00a0
to sell will
\u00a0
be withdrawn.
\u00a0
In addition,
\u00a0
management
\u00a0
must be committed
\u00a0
to the plan,
\u00a0
and must
\u00a0
be expected
\u00a0
that the sale
will be completed within a year.
Property,
\u00a0
plant and
\u00a0
equipment
\u00a0
and intangible
\u00a0
assets are
\u00a0
not depreciated
\u00a0
or amortised
\u00a0
once classified
\u00a0
as held
\u00a0
for sale.
\u00a0
The equity
\u00a0
method is
discontinued
\u00a0
for associated
\u00a0
companies
\u00a0
classified
\u00a0
as held for
\u00a0
sale.
A disposal group qualifies as discontinued operation if
\u00a0
it is a cash generating unit that
\u00a0
has either been disposed of, or is
\u00a0
classified as held for sale,
and represent
\u00a0
a separate
\u00a0
major line
\u00a0
of business
\u00a0
or geographical
\u00a0
area of operations.
\u00a0
Discontinued
\u00a0
operations
\u00a0
are excluded
\u00a0
from the results
\u00a0
of
continuing
\u00a0
operations
\u00a0
and are
\u00a0
presented
\u00a0
as a single
\u00a0
amount as
\u00a0
profit or
\u00a0
loss after
\u00a0
tax from
\u00a0
discontinued
\u00a0
operations
\u00a0
in the income
\u00a0
statement.
Discontinued operations are also excluded from segment reporting.
\u00a0
All consolidation procedures are still applicable, and
\u00a0
only external revenues
and expenses
\u00a0
are shown
\u00a0
as discontinued
\u00a0
operations.
Accounting policies
\u00a0
Non-current
\u00a0
assets and
\u00a0
disposal
\u00a0
groups are
\u00a0
classified
\u00a0
as held for
\u00a0
sale if their
\u00a0
carrying
\u00a0
amounts will
\u00a0
be recovered
\u00a0
principally
\u00a0
through sale
\u00a0
rather than
continuing
\u00a0
use. This
\u00a0
also applies
\u00a0
for situations
\u00a0
where the
\u00a0
Group continues
\u00a0
its operations
\u00a0
but loses
\u00a0
control over
\u00a0
the operation.
\u00a0
Non-current
\u00a0
assets
and disposal
\u00a0
groups classified
\u00a0
as held for
\u00a0
sale are
\u00a0
measured
\u00a0
at the lower
\u00a0
of their
\u00a0
carrying
\u00a0
amount and
\u00a0
fair value
\u00a0
less cost
\u00a0
to sell and
\u00a0
presented
separately
\u00a0
as assets
\u00a0
held for
\u00a0
sale and
\u00a0
liabilities
\u00a0
held for
\u00a0
sale in the
\u00a0
statement
\u00a0
of financial
\u00a0
position.
The criteria
\u00a0
for held
\u00a0
for sale classification
\u00a0
is regarded
\u00a0
as met only
\u00a0
when the sale
\u00a0
is highly
\u00a0
probable,
\u00a0
and the asset
\u00a0
or disposal
\u00a0
group is
\u00a0
available
\u00a0
for
immediate sale in its present condition. Actions required
\u00a0
to complete the sale should indicate that
\u00a0
it is unlikely that significant changes to the plan
will be
\u00a0
made or
\u00a0
that the plan
\u00a0
to sell will
\u00a0
be withdrawn.
\u00a0
In addition,
\u00a0
management
\u00a0
must be committed
\u00a0
to the plan,
\u00a0
and must
\u00a0
be expected
\u00a0
that the sale
will be completed within a year.
Property,
\u00a0
plant and
\u00a0
equipment
\u00a0
and intangible
\u00a0
assets are
\u00a0
not depreciated
\u00a0
or amortised
\u00a0
once classified
\u00a0
as held
\u00a0
for sale.
\u00a0
The equity
\u00a0
method is
discontinued
\u00a0
for associated
\u00a0
companies
\u00a0
classified
\u00a0
as held for
\u00a0
sale.
A disposal group qualifies as discontinued operation if
\u00a0
it is a cash generating unit that
\u00a0
has either been disposed of, or is
\u00a0
classified as held for sale,
and represent
\u00a0
a separate
\u00a0
major line
\u00a0
of business
\u00a0
or geographical
\u00a0
area of operations.
\u00a0
Discontinued
\u00a0
operations
\u00a0
are excluded
\u00a0
from the results
\u00a0
of
continuing
\u00a0
operations
\u00a0
and are
\u00a0
presented
\u00a0
as a single
\u00a0
amount as
\u00a0
profit or
\u00a0
loss after
\u00a0
tax from
\u00a0
discontinued
\u00a0
operations
\u00a0
in the income
\u00a0
statement.
Discontinued operations are also excluded from segment reporting.
\u00a0
All consolidation procedures are still applicable, and
\u00a0
only external revenues
and expenses
\u00a0
are shown
\u00a0
as discontinued
\u00a0
operations.
NOTE 13
Cash flow information
This note summarises
\u00a0
the most significant
\u00a0
cash inflows and
\u00a0
outflows during
\u00a0
the year, including
\u00a0
significant
investments
\u00a0
and disposals
\u00a0
in addition
\u00a0
to payments of
\u00a0
interest-bearing
\u00a0
liabilities
\u00a0
and leasing liabilities.
Accounting policies
Telenor presents the statement of cash flows
\u00a0
using the indirect method. Cash inflows and
\u00a0
outflows are shown separately for investing and
financing activities, while operating activities include both cash
\u00a0
and non-cash line items. Interest received and paid,
\u00a0
and dividends received, are
reported as a part
\u00a0
of operating activities. Dividends distributed by Telenor
\u00a0
ASA and subsidiaries with non-controlling interests are included
\u00a0
as a
part of financing
\u00a0
activities.
\u00a0
Value-added
\u00a0
tax (VAT)
\u00a0
and other
\u00a0
similar taxes
\u00a0
are regarded
\u00a0
as collection
\u00a0
of tax on
\u00a0
behalf of
\u00a0
authorities
\u00a0
and are
\u00a0
reported
net. Discontinued
\u00a0
operations
\u00a0
are included
\u00a0
in the cash
\u00a0
flow statement
\u00a0
and information
\u00a0
about operating,
\u00a0
financing,
\u00a0
investing
\u00a0
cash flows
\u00a0
from
discontinued
\u00a0
operations
\u00a0
is shown
\u00a0
in note 12.
Changes in net
\u00a0
operating working
\u00a0
capital
Changes in net operating working capital include changes in accounts
\u00a0
receivable and accounts payable related to operating activities, and
inventory.
NOK in millions
2022
2021
Inventory
( 186)
( 319)
Trade and other receivables
(1 377)
392
Trade and
\u00a0
other payables
174
831
Changes in
\u00a0
net operating
\u00a0
working
\u00a0
capital
(1 389)
905
Property, plant
\u00a0
and equipment
\u00a0
and intangible
\u00a0
assets reconciliation
\u00a0
of additions
\u00a0
and purchases
NOK in millions
2022
2021
Additions to property, plant and equipment and (see note 17)
(13 789)
(14 888)
Additions to intangible assets (see note 15)
(3 092)
(2 816)
Additions to right-of-use assets (see note
\u00a0
16)
(9 963)
(9 015)
Capital expenses incurred as part of assets held
\u00a0
for sale
(1 203)
( 127)
8 871
5 704
Change in
\u00a0
estimates
\u00a0
for ARO obligations
( 856)
( 339)
Changes in accounts payable and prepayments
( 510)
1 985
Other Adjustments
1 244
50
Purchases of property plant and equipment and intangible assets (cash
\u00a0
flow from investing activities)
(19 298)
(19 447)
Cash payments at or before lease commencement date
\u00a0
are classified as cash outflows from investing
\u00a0
activities. Subsequent payments during the
lease term are classified as cash outflows from
\u00a0
financing activities.
During 2022,
\u00a0
the recognised
\u00a0
lease liabilities
\u00a0
of NOK 8.9
\u00a0
billion represent
\u00a0
the deferred
\u00a0
payments
\u00a0
of total
\u00a0
additions
\u00a0
in right-of-use
\u00a0
assets of
\u00a0
NOK 10.0
billion, NOK 1.1 billion was paid at
\u00a0
or before lease commencement date mainly relating
\u00a0
to spectrum licences in Grameenphone, Pakistan and
Norway, which is classified as cash outflow
\u00a0
from investing activities. See note 16 for
\u00a0
more information related to leases.
During 2021,
\u00a0
the recognised
\u00a0
lease liabilities
\u00a0
of NOK 5.7
\u00a0
billion represent
\u00a0
the deferred
\u00a0
payments
\u00a0
of total
\u00a0
additions
\u00a0
in right-of-use
\u00a0
assets of
\u00a0
NOK 9.0
billion, NOK 3.3 billion was paid at or
\u00a0
before lease commencement date mainly relating to
\u00a0
spectrum licences in Pakistan (NOK 2.2 billion),
Grameenphone
\u00a0
and Sweden, which is classified as cash
\u00a0
outflow from investing activities.
\u00a0
See note 16 for more information related to
\u00a0
leases.
Changes in accounts payable and prepayments in 2022 are
\u00a0
mainly related to change in capex related payables in Dtac
\u00a0
and Grameenphone.
Changes in accounts payable and prepayments in 2021
\u00a0
are mainly due to reclassification from prepaid capex
\u00a0
to right-of-use licences in
\u00a0
Pakistan.
\u00a0
Acquisitions
\u00a0
and disposals
\u00a0
of subsidiaries,
\u00a0
associated companies
\u00a0
and joint ventures
The table below shows the effects on
\u00a0
the consolidated statement of financial position from
\u00a0
disposals of subsidiaries, associated companies, and
joint ventures.
NOK in millions
2022
2021
Disposals of subsidiaries, associated companies, and joint ventures
Associated
\u00a0
companies
\u00a0
and joint
\u00a0
ventures (refer
\u00a0
to note 35)
432
( 3)
Other non-current
\u00a0
assets
15 302
12
Current assets
12 580
-
Liabilities
(24 144)
( 1)
Gains (losses)
\u00a0
adjusted
\u00a0
for translation
\u00a0
differences
\u00a0
on disposals
1)
34 339
( 174)
Sales price
37 916
( 166)
(34 116)
182
Proceeds
\u00a0
received
\u00a0
as sale
\u00a0
consideration
3 798
17
Cash in subsidiaries
\u00a0
disposed
\u00a0
of
(8 460)
-
Proceeds from disposal of subsidiaries and associated companies net of cash
\u00a0
disposed of
(4 662)
17
1)
In 2022 adjusted for NOK 0.6 billion relating to
\u00a0
reclassification of translation differences from other
\u00a0
comprehensive income to the income statement (see
\u00a0
note
28) the total gain of NOK 34.3 billion mainly
\u00a0
relates to deconsolidation of Digi and recognition as
\u00a0
an associate, sale of Telenor Myanmar and disposal
\u00a0
of fixed
non-core assets in Sweden (see note 28, 35 and
\u00a0
12). In 2021, there are no actual disposals, the
\u00a0
effects are mainly related to adjustments to disposals
\u00a0
made in
2020.
During 2022,
\u00a0
disposals
\u00a0
of associated
\u00a0
companies
\u00a0
and joint
\u00a0
ventures
\u00a0
were mainly
\u00a0
related to
\u00a0
disposal
\u00a0
of the associated
\u00a0
company Wave
\u00a0
Money,
\u00a0
see
note 35.
During 2022, disposals of subsidiaries were mainly
\u00a0
related to deconsolidation of Digi and recognition as
\u00a0
an associate, sale of Telenor Myanmar and
disposal of fixed non-core assets in
\u00a0
Sweden.
\u00a0
During 2021, disposals of subsidiaries were mainly related to
\u00a0
disposal of development properties.
The table below shows the effects on
\u00a0
the consolidated statement of financial position from
\u00a0
acquisition of subsidiaries, associated companies, and
joint ventures.
NOK in millions
2022
2021
Purchases of subsidiaries associated companies, and joint ventures
Investments
\u00a0
in associated
\u00a0
companies
\u00a0
and joint
\u00a0
ventures
35 089
393
Total purchase price and capital injections
35 089
393
(34 098)
( 5)
Cash payments
\u00a0
related
\u00a0
to acquisitions
( 991)
( 391)
Purchases of subsidiaries associated companies and joint ventures net of cash
\u00a0
acquired
( 991)
( 391)
During 2022, investments in associated companies and
\u00a0
joint ventures are mainly related to deconsolidation of
\u00a0
Digi and recognition as an associate,
Telenor\u2019s acquisition of 73.4 million shares from
\u00a0
Axiata and capital injection in Telenor Microfinance
\u00a0
Bank Limited (TMB), see note 35.
\u00a0
During 2021, investments in associated companies and
\u00a0
joint ventures are mainly related to capital injection
\u00a0
in Telenor Microfinance Bank Limited
Reconciliation
\u00a0
of interest bearing
\u00a0
liabilities
NOK in millions
2022
2021
Interest-
bearing
liabilities
Lease liabilities
Total
Interest-
bearing
liabilities
Lease liabilities
Total
Balance as of 1 January
97 087
35 077
132 164
105 923
44 882
150 805
Cash flow
\u00a0
from Financing
\u00a0
activities
Proceeds
\u00a0
from borrowings
20 956
-
20 956
26 470
-
26 470
Repayments
\u00a0
of borrowings
(21 044)
-
(21 044)
(29 399)
-
(29 399)
Payments
\u00a0
of lease
\u00a0
liabilities
\u00a0
related to
\u00a0
spectrum
\u00a0
licences
-
(2 483)
(2 483)
-
(2 871)
(2 871)
Payments
\u00a0
of lease
\u00a0
liabilities
\u00a0
related to
\u00a0
other lease
\u00a0
contracts
-
(5 589)
(5 589)
-
(5 955)
(5 955)
Net cash flow from financing activities
( 88)
(8 072)
(8 159)
(2 930)
(8 826)
(11 756)
Change due
\u00a0
to hedge
\u00a0
accounting
( 585)
-
( 585)
(1 160)
-
(1 160)
Effects from
\u00a0
exchange
\u00a0
rate fluctuations
5 138
744
5 882
(4 915)
(2 227)
(7 142)
Net interest
\u00a0
paid/accrued
205
277
483
( 10)
353
343
Acquisitions
-
-
-
-
-
-
Disposals
(10 490)
(5 359)
(15 849)
( 22)
-
( 22)
-
8 871
8 871
-
5 704
5 704
Termination
\u00a0
and reassessment
\u00a0
of lease
\u00a0
contracts
-
( 589)
( 589)
-
(4 076)
(4 076)
Classified as liabilities held for sale
-
-
-
-
( 733)
( 733)
Other
627
141
767
201
-
201
Other changes
(5 106)
4 085
(1 020)
(5 906)
( 979)
(6 885)
Balance as of 31 December
91 893
31 091
122 984
97 086
35 077
132 164
Non-current liabilities
82 724
24 417
107 141
87 811
28 101
115 911
Current liabilities
9 169
6 674
15 843
9 276
6 977
16 253
Cash flow from financing activities consists of
\u00a0
proceeds from and repayments of borrowings, including
\u00a0
repayments of principal portion of lease
liabilities.
\u00a0
Net cash outflow
\u00a0
from financing
\u00a0
activities
\u00a0
excluding
\u00a0
repayments
\u00a0
of lease
\u00a0
liabilities
\u00a0
amounted
\u00a0
to NOK 0.1
\u00a0
billion in
\u00a0
2022 compared
\u00a0
to NOK
2.9 billion in 2021, mainly explained by
\u00a0
no bond issuances under the EMTN program
\u00a0
in 2022 (see note 30).
Cash payments
\u00a0
related to lease
\u00a0
contracts
NOK in millions
Classification
\u00a0
in cash flow
\u00a0
statement
2022
2021
Payments
\u00a0
of lease
\u00a0
liabilities
\u00a0
\u2013 principal
\u00a0
portion
Financing activities
8 072
8 826
Payments of lease liabilities \u2013 interest portion
Operating activities
1 060
1 029
Payments
\u00a0
of variable,
\u00a0
short term
\u00a0
and low
\u00a0
value leases
Operating activities
3 074
3 540
Prepayments
\u00a0
made at
\u00a0
or before
\u00a0
lease commencement
Investing
\u00a0
activities
803
1 202
Total cash outflow
13 009
14 597
Repayments
\u00a0
of the principal
\u00a0
portion related
\u00a0
to total
\u00a0
lease liabilities
\u00a0
in 2022
\u00a0
of NOK 8.1
\u00a0
billion (NOK
\u00a0
8.8 billion
\u00a0
in 2021)
\u00a0
include instalment
\u00a0
payment of
spectrum
\u00a0
licences
\u00a0
of NOK 2.5
\u00a0
billion (NOK
\u00a0
2.9 billion
\u00a0
in 2021) and
\u00a0
repayments
\u00a0
of other leases
\u00a0
of NOK 5.6
\u00a0
billion (NOK
\u00a0
6.0 billion
\u00a0
in 2021).
\u00a0
The
instalment payments of spectrum licences in 2022 and
\u00a0
2021 were mainly in dtac, Norway and Pakistan.
\u00a0
Lease payments related to other lease
contracts were mainly in dtac, Sweden, Digi, Pakistan
\u00a0
and Grameenphone in 2022 whereas in 2021 it was
\u00a0
mainly in dtac, Sweden, Digi, Myanmar,
Pakistan.
Repayments
\u00a0
of the interest
\u00a0
portion of
\u00a0
total lease
\u00a0
liabilities
\u00a0
in 2022
\u00a0
of NOK 1.1
\u00a0
billion include
\u00a0
repayments
\u00a0
of interest
\u00a0
related to
\u00a0
spectrum
\u00a0
licences
\u00a0
of
NOK 0.4
\u00a0
billion (NOK
\u00a0
0.3 billion
\u00a0
in 2021)
\u00a0
and repayments
\u00a0
of interest
\u00a0
related
\u00a0
to other lease
\u00a0
contracts
\u00a0
of NOK 0.7
\u00a0
billion (NOK
\u00a0
0.7 billion
\u00a0
in 2021).
Payments
\u00a0
of variable,
\u00a0
short term
\u00a0
and low
\u00a0
value leases
\u00a0
of NOK 3.1
\u00a0
billion include
\u00a0
variable lease
\u00a0
payments of
\u00a0
NOK 3.0
\u00a0
billion
\u00a0
and payments
\u00a0
of short
term and low value leases of NOK 0.2
\u00a0
billion.
\u00a0
Prepayments
\u00a0
of investing
\u00a0
activities
\u00a0
of NOK 0.8
\u00a0
billion
\u00a0
in 2022
\u00a0
mainly related
\u00a0
to payments
\u00a0
made at
\u00a0
or before
\u00a0
acquisition
\u00a0
of spectrum
\u00a0
licences
\u00a0
of NOK
0.3 billion in Norway for the bands of
\u00a0
2500-2690 MHz and 3400-3800 MHz and NOK 0.3
\u00a0
billion in Grameenphone for the bands 2.6
\u00a0
GHz.
Accounting policies
Telenor presents the statement of cash flows
\u00a0
using the indirect method. Cash inflows and
\u00a0
outflows are shown separately for investing and
financing activities, while operating activities include both cash
\u00a0
and non-cash line items. Interest received and paid,
\u00a0
and dividends received, are
reported as a part
\u00a0
of operating activities. Dividends distributed by Telenor
\u00a0
ASA and subsidiaries with non-controlling interests are included
\u00a0
as a
part of financing
\u00a0
activities.
\u00a0
Value-added
\u00a0
tax (VAT)
\u00a0
and other
\u00a0
similar taxes
\u00a0
are regarded
\u00a0
as collection
\u00a0
of tax on
\u00a0
behalf of
\u00a0
authorities
\u00a0
and are
\u00a0
reported
net. Discontinued
\u00a0
operations
\u00a0
are included
\u00a0
in the cash
\u00a0
flow statement
\u00a0
and information
\u00a0
about operating,
\u00a0
financing,
\u00a0
investing
\u00a0
cash flows
\u00a0
from
discontinued
\u00a0
operations
\u00a0
is shown
\u00a0
in note 12.
NOTE 14
Goodwill
Goodwill relates to excess values that has not been allocated
\u00a0
to other assets in business combinations.
\u00a0
Goodwill
typically represents the value of synergies, employees and other assets
\u00a0
that do not qualify for recognition as
separate identifiable assets according to IFRS. Goodwill is not amortised
\u00a0
but tested for impairment together with
other assets in cash-generating units, refer to note 18 for further
\u00a0
information about impairment of assets.
\u00a0
Accounting policies
Goodwill
\u00a0
arises in business combinations as the difference
\u00a0
between the consideration and the acquired business\u2019
\u00a0
identifiable assets and assumed
liabilities at the acquisition date. Assets and
\u00a0
liabilities are generally recognised at fair value, except for
\u00a0
non-current assets classified as held for sale
and deferred
\u00a0
taxes which
\u00a0
are recognised
\u00a0
at nominal
\u00a0
value. The
\u00a0
fair value
\u00a0
of any previously
\u00a0
held equity
\u00a0
interests
\u00a0
and the amount
\u00a0
of any non-
controlling interest is also included when determining the
\u00a0
amount of goodwill.
Key judgments
\u00a0
and estimates
The fair value assessment of assets and
\u00a0
liabilities in a business combination usually include
\u00a0
significant judgments and estimates, as valuation
techniques can include assumptions on future revenues,
\u00a0
net income, outcome of legal claims and
\u00a0
many other variables. Telenor always use
external
\u00a0
valuation
\u00a0
experts to
\u00a0
assess the
\u00a0
fair value
\u00a0
of assets
\u00a0
and liabilities
\u00a0
in significant
\u00a0
business combinations.
\u00a0
Further,
\u00a0
the impairment
\u00a0
testing of
goodwill
\u00a0
includes
\u00a0
a variety
\u00a0
of key judgments
\u00a0
and estimates
\u00a0
made by
\u00a0
management.
\u00a0
See further
\u00a0
description
\u00a0
in note 18
\u00a0
Impairment.
Origination
\u00a0
of goodwill
The table below illustrates where the goodwill
\u00a0
has originated and the development in carrying amounts.
NOK in millions
Telenor
Sweden
dtac
Thailand
DNA
Finland
Other
1)
Sum
As of 1 January 2021
6 771
3 572
17 401
1 504
29 248
Translations differences
( 455)
( 249)
( 807)
( 7)
(1 518)
As of 31 December 2021
6 317
3 323
16 594
1 497
27 730
Translations differences
( 187)
241
901
4
958
Derecognised on disposal of subsidiaries
( 475)
-
-
( 604)
(1 079)
As of 31 December 2022
5 655
3 564
17 495
896
27 609
Accumulated impairment
As of 1 January 2021
( 278)
-
-
( 24)
( 301)
Translations differences
19
-
-
-
19
As of 31 December 2021
( 259)
-
-
( 24)
( 283)
Translations differences
8
-
-
-
8
As of 31 December 2022
( 251)
-
-
( 24)
( 275)
Carrying amount
As of 31 December 2022
5 403
3 564
17 495
873
27 335
As of 31 December 2021
6 057
3 323
16 594
1 473
27 448
1)
Other includes primarily Digi (Malaysia) and Telenor
\u00a0
Norway.
NOTE 15
Intangible assets
A significant part of intangible assets relates to software either acquired
\u00a0
individually, generated internally or
acquired in business combinations. Intangible assets
\u00a0
also include customer bases and trademarks in addition to
other intangible assets.
\u00a0
Accounting policies
\u00a0
Intangible
\u00a0
assets acquired
\u00a0
individually
\u00a0
are measured
\u00a0
initially
\u00a0
at cost and
\u00a0
recognised
\u00a0
as an intangible
\u00a0
assets when
\u00a0
the Group
\u00a0
has control
\u00a0
over the
asset, future
\u00a0
economic
\u00a0
benefits
\u00a0
are expected
\u00a0
to flow to
\u00a0
the Group
\u00a0
and the cost
\u00a0
can be measured
\u00a0
reliably.
\u00a0
The cost
\u00a0
to be capitalised
\u00a0
as part of
\u00a0
the
assets includes direct and incremental costs and,
\u00a0
for qualifying assets, borrowing costs. The cost
\u00a0
of intangible assets acquired in a business
combination
\u00a0
is the fair
\u00a0
value at
\u00a0
the date of
\u00a0
acquisition.
\u00a0
Following
\u00a0
that initial
\u00a0
recognition,
\u00a0
intangible
\u00a0
assets are
\u00a0
carried at
\u00a0
cost less
\u00a0
accumulated
amortisation and any impairment losses.
\u00a0
The straight-line
\u00a0
amortisation method is used for most intangible
\u00a0
assets as this best reflects the
consumption
\u00a0
of the assets.
\u00a0
The amortisation
\u00a0
period for
\u00a0
a customer
\u00a0
base is
\u00a0
the expected
\u00a0
lifetime
\u00a0
of the customer
\u00a0
relationship,
\u00a0
and the amortisation
method is
\u00a0
based on
\u00a0
historical
\u00a0
experience
\u00a0
of churn (customers
\u00a0
ending their
\u00a0
relationship)
\u00a0
for the different
\u00a0
businesses.
\u00a0
The useful
\u00a0
lives and
amortisation methods are reviewed at least annually.
\u00a0
Refer to note 18 for further information
\u00a0
about impairment.
Key judgments
\u00a0
and estimates
Amortisation expenses are based on management\u2019s estimates of
\u00a0
amortisation method, useful life and residual value.
\u00a0
Estimates may change due to
technological developments, changed competition or market conditions,
\u00a0
geopolitical developments and other factors. In particular,
\u00a0
technological
developments
\u00a0
are difficult
\u00a0
to predict
\u00a0
as trends
\u00a0
and pace
\u00a0
of development
\u00a0
may change
\u00a0
over time.
\u00a0
Estimated
\u00a0
useful lives
\u00a0
for similar
\u00a0
types of assets
may vary
\u00a0
between
\u00a0
different
\u00a0
entities due
\u00a0
to factors
\u00a0
such as growth
\u00a0
rate, maturity
\u00a0
of the market,
\u00a0
history and
\u00a0
expectations
\u00a0
for replacements
\u00a0
or
transfer of
\u00a0
assets, climate
\u00a0
and quality
\u00a0
of the technology
\u00a0
used. A change
\u00a0
in estimated
\u00a0
useful life
\u00a0
is a change
\u00a0
in accounting
\u00a0
estimate,
\u00a0
and
amortisation plans are adjusted prospectively. Refer to
\u00a0
note 18 for further information about impairment.
Intangible assets
NOK in millions
Customer
base
Trade-
marks
1)
Software
acquired
Internally
generated
software
Others
Work in
progress
2)
Total
As of 1 January 2021
2 560
6 372
19 762
4 253
2 097
1 894
36 938
Reclassifications
3)
-
-
1 386
700
( 423)
(2 053)
( 391)
Additions
-
-
1 111
-
99
1 379
2 589
Additions internally developed
-
-
-
219
8
-
227
Translation differences
( 114)
( 331)
( 518)
( 103)
( 92)
( 40)
(1 199)
Derecognition
( 77)
-
( 871)
( 392)
( 250)
( 1)
(1 592)
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
-
-
( 361)
-
-
-
( 361)
As of 31 December 2021
2 369
6 041
20 510
4 677
1 438
1 178
36 212
Reclassifications
3)
-
-
1 017
415
31
(1 448)
15
Additions
-
-
1 129
-
36
1 819
2 984
Additions internally developed
-
-
-
99
9
-
108
Translation differences
87
356
81
( 26)
( 21)
1
478
Derecognition
-
( 158)
(2 752)
( 153)
( 378)
( 275)
(3 716)
As of 31 December 2022
2 456
6 240
19 985
5 011
1 115
1 275
36 081
Accumulated amortisation and impairment
As of 1 January 2021
(1 064)
(3 086)
(16 309)
(3 552)
(1 703)
( 2)
(25 716)
Reclassifications
3)
-
-
-
( 40)
230
-
190
Amortisation - continuing operations
( 247)
-
(1 955)
( 504)
( 188)
-
(2 894)
Amortisation - discontinued operations
-
-
( 184)
-
-
-
( 184)
Impairment - discontinued operations
-
-
( 140)
-
-
-
( 140)
Translation differences
50
178
420
62
88
-
798
Derecognition
77
-
855
383
250
2
1 569
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
-
-
361
-
-
-
361
As of 31 December 2021
(1 184)
(2 907)
(16 954)
(3 651)
(1 323)
-
(26 018)
Reclassifications
3)
-
-
1
-
3
-
4
Amortisation - continuing operations
( 238)
-
(1 984)
( 604)
( 70)
-
(2 898)
Amortisation - discontinued operations
-
-
( 173)
-
-
-
( 173)
Impairment - continuing operations
-
-
( 29)
-
-
-
( 30)
Translation differences
( 40)
( 189)
( 17)
10
23
-
( 214)
Derecognition
-
147
2 273
138
378
-
2 936
As of 31 December 2022
(1 463)
(2 949)
(16 884)
(4 108)
( 990)
-
(26 392)
Carrying amount
As of 31 December 2022
993
3 291
3 101
904
125
1 275
9 689
As of 31 December 2021
1 185
3 134
3 556
1 026
115
1 178
10 195
Amortisation periods in years
3-20
-
3-7
3
3-5
-
-
1)
Trademarks have indefinite useful lives.
\u00a0
2)
The Additions line items represent net additions
\u00a0
of work in progress during the financial year. Work
\u00a0
in progress capitalised and activated within the
\u00a0
same
financial year is shown as Additions in the relevant
\u00a0
asset categories in this table.
3)
Including reclassifications to/from other lines in the statement
\u00a0
of financial position which are not a part of
\u00a0
this table.
NOTE 14
Goodwill
Goodwill relates to excess values that has not been allocated
\u00a0
to other assets in business combinations.
\u00a0
Goodwill
typically represents the value of synergies, employees and other assets
\u00a0
that do not qualify for recognition as
separate identifiable assets according to IFRS. Goodwill is not amortised
\u00a0
but tested for impairment together with
other assets in cash-generating units, refer to note 18 for further
\u00a0
information about impairment of assets.
\u00a0
Accounting policies
Goodwill
\u00a0
arises in business combinations as the difference
\u00a0
between the consideration and the acquired business\u2019
\u00a0
identifiable assets and assumed
liabilities at the acquisition date. Assets and
\u00a0
liabilities are generally recognised at fair value, except for
\u00a0
non-current assets classified as held for sale
and deferred
\u00a0
taxes which
\u00a0
are recognised
\u00a0
at nominal
\u00a0
value. The
\u00a0
fair value
\u00a0
of any previously
\u00a0
held equity
\u00a0
interests
\u00a0
and the amount
\u00a0
of any non-
controlling interest is also included when determining the
\u00a0
amount of goodwill.
Key judgments
\u00a0
and estimates
The fair value assessment of assets and
\u00a0
liabilities in a business combination usually include
\u00a0
significant judgments and estimates, as valuation
techniques can include assumptions on future revenues,
\u00a0
net income, outcome of legal claims and
\u00a0
many other variables. Telenor always use
external
\u00a0
valuation
\u00a0
experts to
\u00a0
assess the
\u00a0
fair value
\u00a0
of assets
\u00a0
and liabilities
\u00a0
in significant
\u00a0
business combinations.
\u00a0
Further,
\u00a0
the impairment
\u00a0
testing of
goodwill
\u00a0
includes
\u00a0
a variety
\u00a0
of key judgments
\u00a0
and estimates
\u00a0
made by
\u00a0
management.
\u00a0
See further
\u00a0
description
\u00a0
in note 18
\u00a0
Impairment.
Origination
\u00a0
of goodwill
The table below illustrates where the goodwill
\u00a0
has originated and the development in carrying amounts.
NOK in millions
Telenor
Sweden
dtac
Thailand
DNA
Finland
Other
1)
Sum
As of 1 January 2021
6 771
3 572
17 401
1 504
29 248
Translations differences
( 455)
( 249)
( 807)
( 7)
(1 518)
As of 31 December 2021
6 317
3 323
16 594
1 497
27 730
Translations differences
( 187)
241
901
4
958
Derecognised on disposal of subsidiaries
( 475)
-
-
( 604)
(1 079)
As of 31 December 2022
5 655
3 564
17 495
896
27 609
Accumulated impairment
As of 1 January 2021
( 278)
-
-
( 24)
( 301)
Translations differences
19
-
-
-
19
As of 31 December 2021
( 259)
-
-
( 24)
( 283)
Translations differences
8
-
-
-
8
As of 31 December 2022
( 251)
-
-
( 24)
( 275)
Carrying amount
As of 31 December 2022
5 403
3 564
17 495
873
27 335
As of 31 December 2021
6 057
3 323
16 594
1 473
27 448
1)
Other includes primarily Digi (Malaysia) and Telenor
\u00a0
Norway.
Accounting policies
Goodwill
\u00a0
arises in business combinations as the difference
\u00a0
between the consideration and the acquired business\u2019
\u00a0
identifiable assets and assumed
liabilities at the acquisition date. Assets and
\u00a0
liabilities are generally recognised at fair value, except for
\u00a0
non-current assets classified as held for sale
and deferred
\u00a0
taxes which
\u00a0
are recognised
\u00a0
at nominal
\u00a0
value. The
\u00a0
fair value
\u00a0
of any previously
\u00a0
held equity
\u00a0
interests
\u00a0
and the amount
\u00a0
of any non-
controlling interest is also included when determining the
\u00a0
amount of goodwill.
NOTE 15
Intangible assets
A significant part of intangible assets relates to software either acquired
\u00a0
individually, generated internally or
acquired in business combinations. Intangible assets
\u00a0
also include customer bases and trademarks in addition to
other intangible assets.
\u00a0
Accounting policies
\u00a0
Intangible
\u00a0
assets acquired
\u00a0
individually
\u00a0
are measured
\u00a0
initially
\u00a0
at cost and
\u00a0
recognised
\u00a0
as an intangible
\u00a0
assets when
\u00a0
the Group
\u00a0
has control
\u00a0
over the
asset, future
\u00a0
economic
\u00a0
benefits
\u00a0
are expected
\u00a0
to flow to
\u00a0
the Group
\u00a0
and the cost
\u00a0
can be measured
\u00a0
reliably.
\u00a0
The cost
\u00a0
to be capitalised
\u00a0
as part of
\u00a0
the
assets includes direct and incremental costs and,
\u00a0
for qualifying assets, borrowing costs. The cost
\u00a0
of intangible assets acquired in a business
combination
\u00a0
is the fair
\u00a0
value at
\u00a0
the date of
\u00a0
acquisition.
\u00a0
Following
\u00a0
that initial
\u00a0
recognition,
\u00a0
intangible
\u00a0
assets are
\u00a0
carried at
\u00a0
cost less
\u00a0
accumulated
amortisation and any impairment losses.
\u00a0
The straight-line
\u00a0
amortisation method is used for most intangible
\u00a0
assets as this best reflects the
consumption
\u00a0
of the assets.
\u00a0
The amortisation
\u00a0
period for
\u00a0
a customer
\u00a0
base is
\u00a0
the expected
\u00a0
lifetime
\u00a0
of the customer
\u00a0
relationship,
\u00a0
and the amortisation
method is
\u00a0
based on
\u00a0
historical
\u00a0
experience
\u00a0
of churn (customers
\u00a0
ending their
\u00a0
relationship)
\u00a0
for the different
\u00a0
businesses.
\u00a0
The useful
\u00a0
lives and
amortisation methods are reviewed at least annually.
\u00a0
Refer to note 18 for further information
\u00a0
about impairment.
Key judgments
\u00a0
and estimates
Amortisation expenses are based on management\u2019s estimates of
\u00a0
amortisation method, useful life and residual value.
\u00a0
Estimates may change due to
technological developments, changed competition or market conditions,
\u00a0
geopolitical developments and other factors. In particular,
\u00a0
technological
developments
\u00a0
are difficult
\u00a0
to predict
\u00a0
as trends
\u00a0
and pace
\u00a0
of development
\u00a0
may change
\u00a0
over time.
\u00a0
Estimated
\u00a0
useful lives
\u00a0
for similar
\u00a0
types of assets
may vary
\u00a0
between
\u00a0
different
\u00a0
entities due
\u00a0
to factors
\u00a0
such as growth
\u00a0
rate, maturity
\u00a0
of the market,
\u00a0
history and
\u00a0
expectations
\u00a0
for replacements
\u00a0
or
transfer of
\u00a0
assets, climate
\u00a0
and quality
\u00a0
of the technology
\u00a0
used. A change
\u00a0
in estimated
\u00a0
useful life
\u00a0
is a change
\u00a0
in accounting
\u00a0
estimate,
\u00a0
and
amortisation plans are adjusted prospectively. Refer to
\u00a0
note 18 for further information about impairment.
Intangible assets
NOK in millions
Customer
base
Trade-
marks
1)
Software
acquired
Internally
generated
software
Others
Work in
progress
2)
Total
As of 1 January 2021
2 560
6 372
19 762
4 253
2 097
1 894
36 938
Reclassifications
3)
-
-
1 386
700
( 423)
(2 053)
( 391)
Additions
-
-
1 111
-
99
1 379
2 589
Additions internally developed
-
-
-
219
8
-
227
Translation differences
( 114)
( 331)
( 518)
( 103)
( 92)
( 40)
(1 199)
Derecognition
( 77)
-
( 871)
( 392)
( 250)
( 1)
(1 592)
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
-
-
( 361)
-
-
-
( 361)
As of 31 December 2021
2 369
6 041
20 510
4 677
1 438
1 178
36 212
Reclassifications
3)
-
-
1 017
415
31
(1 448)
15
Additions
-
-
1 129
-
36
1 819
2 984
Additions internally developed
-
-
-
99
9
-
108
Translation differences
87
356
81
( 26)
( 21)
1
478
Derecognition
-
( 158)
(2 752)
( 153)
( 378)
( 275)
(3 716)
As of 31 December 2022
2 456
6 240
19 985
5 011
1 115
1 275
36 081
Accumulated amortisation and impairment
As of 1 January 2021
(1 064)
(3 086)
(16 309)
(3 552)
(1 703)
( 2)
(25 716)
Reclassifications
3)
-
-
-
( 40)
230
-
190
Amortisation - continuing operations
( 247)
-
(1 955)
( 504)
( 188)
-
(2 894)
Amortisation - discontinued operations
-
-
( 184)
-
-
-
( 184)
Impairment - discontinued operations
-
-
( 140)
-
-
-
( 140)
Translation differences
50
178
420
62
88
-
798
Derecognition
77
-
855
383
250
2
1 569
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
-
-
361
-
-
-
361
As of 31 December 2021
(1 184)
(2 907)
(16 954)
(3 651)
(1 323)
-
(26 018)
Reclassifications
3)
-
-
1
-
3
-
4
Amortisation - continuing operations
( 238)
-
(1 984)
( 604)
( 70)
-
(2 898)
Amortisation - discontinued operations
-
-
( 173)
-
-
-
( 173)
Impairment - continuing operations
-
-
( 29)
-
-
-
( 30)
Translation differences
( 40)
( 189)
( 17)
10
23
-
( 214)
Derecognition
-
147
2 273
138
378
-
2 936
As of 31 December 2022
(1 463)
(2 949)
(16 884)
(4 108)
( 990)
-
(26 392)
Carrying amount
As of 31 December 2022
993
3 291
3 101
904
125
1 275
9 689
As of 31 December 2021
1 185
3 134
3 556
1 026
115
1 178
10 195
Amortisation periods in years
3-20
-
3-7
3
3-5
-
-
1)
Trademarks have indefinite useful lives.
\u00a0
2)
The Additions line items represent net additions
\u00a0
of work in progress during the financial year. Work
\u00a0
in progress capitalised and activated within the
\u00a0
same
financial year is shown as Additions in the relevant
\u00a0
asset categories in this table.
3)
Including reclassifications to/from other lines in the statement
\u00a0
of financial position which are not a part of
\u00a0
this table.
Accounting policies
\u00a0
Intangible
\u00a0
assets acquired
\u00a0
individually
\u00a0
are measured
\u00a0
initially
\u00a0
at cost and
\u00a0
recognised
\u00a0
as an intangible
\u00a0
assets when
\u00a0
the Group
\u00a0
has control
\u00a0
over the
asset, future
\u00a0
economic
\u00a0
benefits
\u00a0
are expected
\u00a0
to flow to
\u00a0
the Group
\u00a0
and the cost
\u00a0
can be measured
\u00a0
reliably.
\u00a0
The cost
\u00a0
to be capitalised
\u00a0
as part of
\u00a0
the
assets includes direct and incremental costs and,
\u00a0
for qualifying assets, borrowing costs. The cost
\u00a0
of intangible assets acquired in a business
combination
\u00a0
is the fair
\u00a0
value at
\u00a0
the date of
\u00a0
acquisition.
\u00a0
Following
\u00a0
that initial
\u00a0
recognition,
\u00a0
intangible
\u00a0
assets are
\u00a0
carried at
\u00a0
cost less
\u00a0
accumulated
amortisation and any impairment losses.
\u00a0
The straight-line
\u00a0
amortisation method is used for most intangible
\u00a0
assets as this best reflects the
consumption
\u00a0
of the assets.
\u00a0
The amortisation
\u00a0
period for
\u00a0
a customer
\u00a0
base is
\u00a0
the expected
\u00a0
lifetime
\u00a0
of the customer
\u00a0
relationship,
\u00a0
and the amortisation
method is
\u00a0
based on
\u00a0
historical
\u00a0
experience
\u00a0
of churn (customers
\u00a0
ending their
\u00a0
relationship)
\u00a0
for the different
\u00a0
businesses.
\u00a0
The useful
\u00a0
lives and
amortisation methods are reviewed at least annually.
\u00a0
Refer to note 18 for further information
\u00a0
about impairment.
NOTE 16
Right-of-use assets
Telenor has chosen to account for the right to use the spectrum as a lease,
\u00a0
where the identified asset is the
frequency band that is exclusive for Telenor in the lease period. Telenor
\u00a0
also leases passive infrastructure such as
towers and cables in addition to land and property. Refer to 29 for
\u00a0
more information about lease liabilities.
\u00a0
Accounting policies
A lease
\u00a0
liability
\u00a0
and a right-of-use
\u00a0
asset is
\u00a0
recognised
\u00a0
at commencement
\u00a0
date in
\u00a0
lease contracts
\u00a0
where Telenor
\u00a0
has the right
\u00a0
to direct
\u00a0
the use and
obtains substantially
\u00a0
all the economic
\u00a0
benefits
\u00a0
from the
\u00a0
use of an
\u00a0
identified
\u00a0
asset. For
\u00a0
spectrum
\u00a0
contracts,
\u00a0
Telenor
\u00a0
has chosen
\u00a0
to account
\u00a0
for the
right to
\u00a0
use the spectrum
\u00a0
as a lease,
\u00a0
where the
\u00a0
identified
\u00a0
asset is
\u00a0
the frequency
\u00a0
band that
\u00a0
is exclusive
\u00a0
for Telenor
\u00a0
during the
\u00a0
lease period.
\u00a0
Lease
payments on short-term leases
\u00a0
(less than 12 months) and low-value asset leases
\u00a0
(mainly office equipment) are generally expensed on
\u00a0
a straight-line
basis over the lease term. The short-term
\u00a0
exemption does not apply to spectrum leases or
\u00a0
leases with purchase options.
\u00a0
The lease liability represents the net present value
\u00a0
of lease payments over the lease period
\u00a0
and include fixed payments, in-substance fixed
payments, non-lease components, residual value
\u00a0
guarantees and lease incentives. The lease payments also
\u00a0
include the exercise price of a
purchase option reasonably certain to be exercised
\u00a0
and termination penalties when termination is expected.
\u00a0
Variable lease payments such as
licence payments based on revenue sharing arrangements
\u00a0
are expensed as incurred.
The incremental
\u00a0
borrowing
\u00a0
rate generally
\u00a0
used to determine
\u00a0
the net present
\u00a0
value is
\u00a0
based on
\u00a0
the respective
\u00a0
country\u2019s risk-free
\u00a0
rate for
\u00a0
the term
corresponding
\u00a0
to the lease term, adjusted for own
\u00a0
credit risk. Subsidiaries with external financing use
\u00a0
the external borrowing rate corresponding to
The non-cancellable lease period is basis for
\u00a0
the lease liability, and periods covered by
\u00a0
options to extend or terminate the lease are
\u00a0
included only
when it is reasonably certain the lease period
\u00a0
will be extended. The lease liability is remeasured if
\u00a0
the lease term or lease payments change,
\u00a0
or there
are other modifications. Significant amounts paid up-front
\u00a0
on spectrum and other lease contracts are
\u00a0
recognised as prepayment until
Right-of-use assets are measured
\u00a0
at cost, less accumulated depreciation and impairments,
\u00a0
and adjusted for any remeasurement of lease
\u00a0
liabilities.
The right-of-use asset includes estimated costs for
\u00a0
dismantling and removing the underlying leased asset, restoring the
\u00a0
site on which it is located
or restoring the underlying leased asset to the
\u00a0
condition required by the terms and conditions of
\u00a0
the lease. Non-refundable value-added tax
\u00a0
is
included as initial direct cost. The right-of-use asset is
\u00a0
depreciated on a straight-line
\u00a0
basis over the shorter of its estimated
\u00a0
useful life and the lease
term. Right-of-use
\u00a0
assets where
\u00a0
it is reasonably
\u00a0
certain that
\u00a0
Telenor will
\u00a0
exercise
\u00a0
a purchase
\u00a0
option at
\u00a0
the end of
\u00a0
the lease
\u00a0
term are
\u00a0
not
depreciated.
Key judgments
\u00a0
and estimates
Determining the lease term can involve significant judgment
\u00a0
for lease contracts with extension or
\u00a0
termination options, as an assessment of
whether or
\u00a0
not it is
\u00a0
reasonably
\u00a0
certain that
\u00a0
the lease
\u00a0
period will
\u00a0
be extended
\u00a0
is required.
\u00a0
The broader
\u00a0
economics
\u00a0
of the contract
\u00a0
and not
\u00a0
only
contractual termination payments are basis for such
\u00a0
assessment. For lease of land for own towers or
\u00a0
leasing of towers from tower companies or
other operators,
\u00a0
factors considered
\u00a0
in particular
\u00a0
for assessing
\u00a0
the lease
\u00a0
term are
\u00a0
technology
\u00a0
development
\u00a0
and potential
\u00a0
changes in
\u00a0
business
models.
\u00a0
Based on
\u00a0
an assessment
\u00a0
of these
\u00a0
factors,
\u00a0
the lease
\u00a0
term for Telenor\u2019s
\u00a0
leases relating
\u00a0
to sites will
\u00a0
normally
\u00a0
be within
\u00a0
a range of
\u00a0
4 to 7 years.
This means
\u00a0
that the lease
\u00a0
term for
\u00a0
sites with
\u00a0
renewal
\u00a0
options shall
\u00a0
normally
\u00a0
be the higher
\u00a0
of a non-cancellable
\u00a0
period or
\u00a0
within a
\u00a0
range of
\u00a0
4 to 7
years. Some sites may be in strategically important
\u00a0
locations and it might be more than
\u00a0
reasonably certain that the sites will be maintained
\u00a0
beyond
7 years.
\u00a0
In these exceptional
\u00a0
cases, the
\u00a0
lease term
\u00a0
may be up
\u00a0
to 10 years.
Right-of-use assets
Right-of-use assets are classified based
\u00a0
on the nature of underlying assets as follow:
NOK in millions
Spectrum
licences
1)
structure
Cables
Land
Buildings
Others
Total
As of 1 January 2021
53 423
20 464
5 851
5 618
4 167
116
89 638
Additions
4 403
2 999
213
748
452
200
9 015
Derecognition
( 93)
(1 121)
( 191)
( 453)
( 348)
( 40)
(2 246)
Reclassifications
( 2)
( 326)
-
238
87
-
( 2)
Translation differences
(2 930)
(1 405)
( 415)
( 299)
( 157)
-
(5 207)
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
(4 563)
(4 414)
(1 403)
( 105)
( 102)
( 6)
(10 594)
As of 31 December 2021
50 237
16 197
4 054
5 747
4 099
270
80 604
Additions
4 845
2 435
1 026
716
816
125
9 963
Derecognition
( 766)
(1 258)
( 291)
( 507)
( 330)
( 28)
(3 180)
Disposal of companies
(5 729)
(4 157)
( 25)
(1 271)
( 60)
( 2)
(11 243)
Reclassifications
1
( 99)
( 17)
-
( 20)
-
( 135)
Translation differences
287
133
( 160)
112
73
3
447
As of 31 December 2022
48 875
13 251
4 586
4 797
4 579
368
76 456
Accumulated
\u00a0
depreciation
As of 1 January 2021
(16 264)
(5 276)
(2 272)
(1 646)
(1 321)
( 46)
(26 826)
Amortisation - continuing operations
(3 073)
(2 365)
( 481)
( 769)
( 700)
( 60)
(7 447)
Amortisation - discontinued operations
( 368)
( 871)
( 133)
( 247)
( 25)
( 2)
(1 646)
Impairment - discontinued operations
(2 542)
-
-
-
-
-
(2 542)
Reassessment
\u00a0
of right-of-use
\u00a0
assets -
\u00a0
discontinued
operations
( 136)
(2 103)
( 720)
( 47)
( 40)
( 1)
(3 047)
Derecognition
93
572
180
278
312
34
1 469
Reclassifications
( 3)
15
( 2)
4
( 14)
-
-
Translation differences
795
391
121
92
70
4
1 473
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
4 543
3 651
1 150
89
88
5
9 526
As of 31 December 2021
(16 954)
(5 986)
(2 156)
(2 247)
(1 631)
( 66)
(29 040)
Amortisation - continuing operations
(3 341)
(2 289)
( 489)
( 780)
( 723)
( 76)
(7 690)
Amortisation - discontinued operations
( 281)
( 518)
( 6)
( 219)
( 12)
-
(1 036)
Impairment - continuing operations
-
( 576)
( 93)
( 272)
( 22)
-
( 963)
Derecognition
740
1 010
144
322
332
26
2 574
Disposal of companies
2 869
1 748
20
530
27
2
5 195
Reclassifications
( 18)
133
( 44)
-
19
-
90
Translation differences
85
( 4)
82
( 23)
( 34)
( 2)
105
As of 31 December 2022
(16 900)
(6 482)
(2 540)
(2 688)
(2 043)
( 116)
(30 770)
Carrying amount
As of 31 December 2021
33 283
10 211
1 898
3 500
2 468
204
51 565
As of 31 December 2022
31 975
6 769
2 046
2 109
2 535
251
45 686
Weighted
\u00a0
average remaining
\u00a0
lease term
As of 31 December 2021
1)
-
5
7
5
9
3
-
As of 31 December 2022
1)
-
5
7
4
9
3
-
Related lease liability disaggregated per class of
As of 31
\u00a0
December
\u00a0
2021
14 760
10 134
1 460
4 499
4 024
201
35 077
As of 31
\u00a0
December
\u00a0
2022
14 878
7 082
1 619
3 263
4 004
245
31 091
1)
See table below for overview spectrum licences,
\u00a0
including lease term.
For lease
\u00a0
of network
\u00a0
passive infrastructure
\u00a0
(lease of
\u00a0
tower space
\u00a0
in networks
\u00a0
and lease
\u00a0
of part of
\u00a0
buildings
\u00a0
for own towers),
\u00a0
land for
\u00a0
own sites
\u00a0
or
towers and lease of buildings for office spaces,
\u00a0
equipment and retail stores, lease agreements generally
\u00a0
contain termination options or renewal
options. These
\u00a0
options are
\u00a0
used to limit
\u00a0
the period
\u00a0
to which
\u00a0
Telenor is
\u00a0
committed
\u00a0
to individual
\u00a0
lease contracts
\u00a0
and to maximise
\u00a0
operational
flexibility in terms of dynamic network requirements. The remaining
\u00a0
non-cancellable period for lease contracts under
\u00a0
network passive
infrastructure is 3 years on average.
\u00a0
The non-cancellable period for lease contracts
\u00a0
related to land is 2 years on average, which
\u00a0
is mainly driven by
non-cancellable lease agreements in Thailand.
\u00a0
As a result of deteriorating macro-economic
\u00a0
situation in Pakistan, an impairment of NOK
\u00a0
963 million related to
\u00a0
right-of-use assets was recognised
in 2022. Please see note 18 for
\u00a0
further information.
\u00a0
In 2021, due to a worsening security and
\u00a0
human rights situation in Myanmar, Telenor made an
impairment
\u00a0
of the right
\u00a0
of use assets
\u00a0
and at the
\u00a0
same time
\u00a0
reassessed
\u00a0
the lease
\u00a0
term of all
\u00a0
the lease
\u00a0
agreements
\u00a0
in Myanmar,
\u00a0
limiting
\u00a0
the lease
term to one
\u00a0
year.
\u00a0
The additions
\u00a0
of spectrum
\u00a0
licences
\u00a0
in 2022 were
\u00a0
related to
\u00a0
additional
\u00a0
spectrum
\u00a0
fee of NOK
\u00a0
1.7 billion
\u00a0
in Pakistan,
\u00a0
which is
\u00a0
pursuant to
\u00a0
the Supreme
Court ruling there the detailed judgement is
\u00a0
still awaited, see further below and note
\u00a0
23 for more information. Moreover, the additions
\u00a0
were related
to acquisition of spectrum under 3500 MHz in
\u00a0
Norway, 2100 MHz in Denmark, and 2600 MHz in
\u00a0
Grameenphone. The additions of spectrum licences
in 2021 were primarily related to renewal
\u00a0
of spectrum under the 900 MHz and 1800
\u00a0
MHz bands in Pakistan, acquisition of spectrum under
\u00a0
1800 MHz
and 2100
\u00a0
MHz bands in Grameenphone, 3500 MHz band in
\u00a0
Sweden and 3500 MHz and 26 GHz bands
\u00a0
in Denmark.
In 2022,
\u00a0
the additions in network passive infrastructure were
\u00a0
mainly related to site leases from towercos
\u00a0
in Grameenphone, contract renewal of
CAT equipment lease in dtac, tower spaces
\u00a0
and part of building for own towers Telenor
\u00a0
Norway and Finland. The additions in cables were
\u00a0
mainly in
Sweden and Grameenphone.
\u00a0
The additions in building were mainly related
\u00a0
to Telenor Real Estate, Telenor South East Asia
\u00a0
Investment Pte Ltd.,
Telenor Sweden and Telenor Denmark. The additions in land
\u00a0
were mainly related to land for own sites
\u00a0
in dtac and Pakistan.
In 2021, the additions in network passive
\u00a0
infrastructure were mainly related to site leases from
\u00a0
towerco in Grameenphone, CAT equipment in dtac,
tower spaces and part of building for own
\u00a0
towers in Digi and Telenor Norway. The
\u00a0
additions in cables were mainly in Sweden. The additions in
building
\u00a0
were mainly
\u00a0
related to
\u00a0
dtac and
\u00a0
Telenor Infra.
\u00a0
The additions
\u00a0
in land
\u00a0
were mainly
\u00a0
related to
\u00a0
land for
\u00a0
own sites
\u00a0
in dtac,
\u00a0
Digi and
\u00a0
Pakistan.
For lease of spectrum, the agreements are
\u00a0
generally non-cancellable. Telenor has not considered periods
\u00a0
covered by renewal options even if in
some agreements
\u00a0
the option to renew exists, given the
\u00a0
uncertainty around terms and conditions of renewal
\u00a0
of licences.
The following table sets forth the spectrum
\u00a0
licences that Telenor holds as of 31 December
\u00a0
2022:
Spectrum (MHz)
Spectrum expiration
Telenor Norway
700
2x10
2039
800
2\u00d710
2033
900
2\u00d715
2033
1800
2\u00d710 + 2\u00d720
2028/2033
2100
2\u00d720
2032
3500
120
2042
Telenor Sweden
700
2x10
1)
2040
800
2x10
1)
2035
900
2x6
1)
2025
1800
2\u00d720
1)
1)
2027/2037
2100
2x10
1),3)
\u00a0
+ 2\u00d79.8 +
\u00a0
5
2025
2600
2x40
2)
2025
3500
100
1)
2045
Telenor Denmark
700
2x5
4)
2040
800
2x10
4)
2034
900
2x10
4)
2034
1500
45
4)
2042
1800
2\u00d725
4)
2032
2100
2\u00d715 + 1\u00d75
2022
2100
2\u00d720
4)
2042
2600
2\u00d720 + 10
2030
3500
140
4)
2042
26000
600
4)
2042
DNA, Finland
700
2x10
2033
800
2x10
2033
900
2x11.6
2033
1800
2x24.8
2033
2100
2x19.8
2033
2600
2x20
2029
3500
130
2033
26000
800
2033
dtac, Thailand
700
2x10
2035
900
2x5
2033
1800
2\u00d75
2033
2100
2x15
2027
2300
60
5)
2025
26000
200
2035
Grameenphone, Bangladesh
900
2\u00d77.4
2026
1800
2\u00d77.4
2026
1800
2\u00d77.2
2026
1800
2x5
2033
1800
2x0.4
2026
2100
2\u00d710
2028
2100
2\u00d710
2026
2600
60
2033
Telenor Pakistan
850
2x10
2031
900
2\u00d74.8
2034
1800
2\u00d78.8
2034
2100
2\u00d75
2029
1)
The licenses are held by Net4Mobility (a joint operation
\u00a0
with Tele 2, owned 50% by Telenor).
2)
Tele 2 and Telenor transferred their respective licences
\u00a0
(2\u00d720 MHz) in the 2600 MHz band to Net4Mobility
\u00a0
on 2 July 2012.
3)
Telenor transferred 2x10 MHz (out of 2x19.6 MHz) in the
\u00a0
2100 MHz band to Net4Mobility on 25 February 2022.
4)
The licenses are held by TT Netv\u00e6rket (a joint operation
\u00a0
with Telia, owned 50% by Telenor).
5)
The spectrum is held under capacity agreement with TOT
\u00a0
and therefore not part of right-of-use assets.
Telenor
\u00a0
Pakistan\u2019s
\u00a0
900 MHz
\u00a0
and 1800
\u00a0
MHz spectrum
\u00a0
licence
\u00a0
expired on
\u00a0
25 May 2019,
\u00a0
and the renewal
\u00a0
fee was
\u00a0
set to NOK
\u00a0
4.0 billion
\u00a0
(USD 449
million)
\u00a0
by the Pakistan
\u00a0
Telecommunication
\u00a0
Authority
\u00a0
(PTA) for
\u00a0
an extension
\u00a0
period of
\u00a0
15 years.
\u00a0
Telenor Pakistan
\u00a0
disagreed
\u00a0
with the
\u00a0
terms and
conditions for renewal, primarily on the price.
\u00a0
Telenor Pakistan is of the opinion that
\u00a0
the renewal price should have been NOK 2.5
\u00a0
billion (USD 291
million),
\u00a0
which was
\u00a0
the same
\u00a0
as for prior
\u00a0
renewals
\u00a0
for other
\u00a0
operators.
\u00a0
Accordingly,
\u00a0
Telenor Pakistan
\u00a0
challenged
\u00a0
the terms
\u00a0
and conditions
\u00a0
for
renewal of said licence in Islamabad High
\u00a0
Court. On 19 July 2021, the High
\u00a0
Court decided the case in Telenor\u2019s disfavor.
\u00a0
Telenor Pakistan appealed
the case
\u00a0
to the Supreme
\u00a0
Court on
\u00a0
31 August
\u00a0
2021. In
\u00a0
December
\u00a0
2021, Telenor
\u00a0
Pakistan
\u00a0
signed the
\u00a0
licence under
\u00a0
protest whilst
\u00a0
waiting
\u00a0
for the
Supreme Court\u2019s
\u00a0
hearing of the case. On 25 May
\u00a0
2022, the Supreme Court rejected the appeal. The
\u00a0
new spectrum price is considered a variable
lease payment that has become in-substance
\u00a0
fixed, and the right-of-use asset and lease
\u00a0
liability has been adjusted accordingly. Telenor Pakistan is
still waiting for the written Supreme Court decision
\u00a0
and will assess to file a review petition. Telenor
\u00a0
Pakistan has paid a total of NOK
\u00a0
2.8 billion (USD
314 million
\u00a0
excl. interest)
\u00a0
of the demanded
\u00a0
licence renewal
\u00a0
fees.
\u00a0
See note 18
\u00a0
for further
\u00a0
information
\u00a0
about impairment
\u00a0
of Pakistan
\u00a0
following
\u00a0
the
Supreme Court
\u00a0
ruling.
Lease expenses
Expenses
\u00a0
recognised
\u00a0
in the income
\u00a0
statement
\u00a0
related
\u00a0
to lease
\u00a0
contracts
\u00a0
are presented
\u00a0
below:
NOK in millions
Classification
\u00a0
in income statement
\u00a0
2022
2021
Depreciation of right-of-use assets
Depreciation
\u00a0
and amortisation
7 690
7 447
Interest expenses
\u00a0
on lease
\u00a0
liabilities
Financial
\u00a0
expenses (note
\u00a0
9)
1 058
1 053
Variable
\u00a0
lease expenses
\u00a0
not dependant
\u00a0
on index
\u00a0
or rate
Other operating
\u00a0
expenses
\u00a0
(note 6)
2 145
2 057
Variable
\u00a0
lease expenses
\u00a0
not dependant
\u00a0
on index
\u00a0
or rate
Cost of materials and traffic charges (note
\u00a0
4)
\u00a0
141
116
Expenses
\u00a0
relating
\u00a0
to short term
\u00a0
leases
Other operating
\u00a0
expenses
\u00a0
(note 6)
54
116
Expenses
\u00a0
relating
\u00a0
to low value
\u00a0
leases
Other operating
\u00a0
expenses
\u00a0
(note 6)
13
12
Total
11 103
10 801
Variable
\u00a0
lease expenses
\u00a0
of NOK 2.3
\u00a0
billion (NOK
\u00a0
2.2 billion
\u00a0
in 2021)
\u00a0
recognised
\u00a0
in other
\u00a0
operating
\u00a0
expenses include
\u00a0
NOK 1.7
\u00a0
billion (NOK
\u00a0
1.8 billion
\u00a0
in
2021) related
\u00a0
to spectrum
\u00a0
and NOK
\u00a0
0.4 billion
\u00a0
(NOK 0.3
\u00a0
billion in
\u00a0
2021) related
\u00a0
to other lease
\u00a0
contracts.
\u00a0
Variable
\u00a0
lease expenses
\u00a0
related
\u00a0
to spectrum
agreements vary mainly with revenue, as a significant
\u00a0
part of the expenses are based on
\u00a0
share of revenues under the agreements. Variable lease
expenses
\u00a0
related
\u00a0
to other lease
\u00a0
contracts
\u00a0
of NOK 0.4
\u00a0
billion
\u00a0
(0.3 billion
\u00a0
NOK in 2021)
\u00a0
represent
\u00a0
energy charges
\u00a0
paid to
\u00a0
lessors as
\u00a0
part of
\u00a0
the lease
agreements for some mobile sites, and the
\u00a0
expenses vary with the consumption of energy
\u00a0
on those mobile sites.
NOTE 29
Lease liabilities
This note gives further information about the lease liabilities of
\u00a0
Telenor, such as lease liabilities per currency and
subsidiary in addition to the maturity profile. Refer to note 16 for
\u00a0
description of accounting policies and key
judgments and estimates relating to lease liabilities and right-of-use
\u00a0
assets.
Lease liabilities
\u00a0
measured at amortised
\u00a0
cost
2022
2021
NOK in millions
Current
Non-current
Total
Current
Non-current
Total
Lease liability related to spectrum licences
2 931
11 944
14 875
2 264
12 496
14 760
Lease liability
\u00a0
related to
\u00a0
other lease
\u00a0
contracts
3 743
12 473
16 216
4 713
15 604
20 317
Total lease liabilities
6 674
24 417
31 091
6 977
28 101
35 077
Distribution
\u00a0
of lease liabilities
\u00a0
per currency
\u00a0
and subsidiary
\u00a0
as of 31 December
\u00a0
2022
2022
2021
NOK in millions
Currency
Spectrum
licences
Other lease
contracts
Total
Spectrum
licences
Other lease
contracts
Total
Subsidiary
dtac
THB
8 696
4 348
13 044
9 350
5 062
14 412
Digi
MYR
-
-
-
1 776
3 428
5 204
Grameenphone
BDT
2 242
2 714
4 955
1 230
2 059
3 289
Pakistan
PKR
-
1 953
1 953
-
2 339
2 339
Pakistan
USD
1 006
-
1 006
88
-
88
Norway
NOK
1 918
379
2 298
1 401
351
1 752
Sweden
SEK
32
1 690
1 721
36
1 875
1 912
Denmark
728
678
1 406
585
569
1 154
Finland
EUR
253
1 557
1 810
294
1 589
1 883
Other units
NOK
-
2 898
2 898
-
3 044
3 044
Total subsidiaries
14 875
16 216
31 091
14 760
20 317
35 077
Lease liabilities
\u00a0
maturity profile
NOK in millions
Total as of
31.12.22
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
Lease liabilities - spectrum licences
14 875
2 931
2 363
1 947
2 012
1 891
863
875
901
424
213
455
Lease liabilities - other lease contracts
16 216
3 743
3 745
2 935
1 894
970
508
412
362
308
193
1 146
Sum of lease liabilities
31 091
6 674
6 109
4 883
3 906
2 861
1 371
1 286
1 263
732
406
1 601
Future interest
\u00a0
payments
3 618
945
742
556
408
289
202
161
122
83
61
49
Total including future interest
payments
34 709
7 619
6 851
5 439
4 314
3 150
1 573
1 447
1 385
815
466
1 650
NOK in millions
Total as of
31.12.21
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
Lease liabilities - spectrum licences
14 760
2 264
1 812
1 852
1 839
1 864
1 768
800
798
811
352
600
Lease liabilities - other lease contracts
20 317
4 713
3 752
3 650
2 944
1 995
796
465
316
226
161
1 299
Sum of lease liabilities
35 077
6 977
5 564
5 503
4 783
3 858
2 565
1 265
1 114
1 037
514
1 899
Future interest
\u00a0
payments
4 672
1 158
927
744
562
404
277
192
151
114
80
63
Total including future interest
payments
39 749
8 135
6 491
6 247
5 345
4 263
2 842
1 457
1 264
1 151
594
1 961
Accounting policies
A lease
\u00a0
liability
\u00a0
and a right-of-use
\u00a0
asset is
\u00a0
recognised
\u00a0
at commencement
\u00a0
date in
\u00a0
lease contracts
\u00a0
where Telenor
\u00a0
has the right
\u00a0
to direct
\u00a0
the use and
obtains substantially
\u00a0
all the economic
\u00a0
benefits
\u00a0
from the
\u00a0
use of an
\u00a0
identified
\u00a0
asset. For
\u00a0
spectrum
\u00a0
contracts,
\u00a0
Telenor
\u00a0
has chosen
\u00a0
to account
\u00a0
for the
right to
\u00a0
use the spectrum
\u00a0
as a lease,
\u00a0
where the
\u00a0
identified
\u00a0
asset is
\u00a0
the frequency
\u00a0
band that
\u00a0
is exclusive
\u00a0
for Telenor
\u00a0
during the
\u00a0
lease period.
\u00a0
Lease
payments on short-term leases
\u00a0
(less than 12 months) and low-value asset leases
\u00a0
(mainly office equipment) are generally expensed on
\u00a0
a straight-line
basis over the lease term. The short-term
\u00a0
exemption does not apply to spectrum leases or
\u00a0
leases with purchase options.
\u00a0
The lease liability represents the net present value
\u00a0
of lease payments over the lease period
\u00a0
and include fixed payments, in-substance fixed
payments, non-lease components, residual value
\u00a0
guarantees and lease incentives. The lease payments also
\u00a0
include the exercise price of a
purchase option reasonably certain to be exercised
\u00a0
and termination penalties when termination is expected.
\u00a0
Variable lease payments such as
licence payments based on revenue sharing arrangements
\u00a0
are expensed as incurred.
The incremental
\u00a0
borrowing
\u00a0
rate generally
\u00a0
used to determine
\u00a0
the net present
\u00a0
value is
\u00a0
based on
\u00a0
the respective
\u00a0
country\u2019s risk-free
\u00a0
rate for
\u00a0
the term
corresponding
\u00a0
to the lease term, adjusted for own
\u00a0
credit risk. Subsidiaries with external financing use
\u00a0
the external borrowing rate corresponding to
The non-cancellable lease period is basis for
\u00a0
the lease liability, and periods covered by
\u00a0
options to extend or terminate the lease are
\u00a0
included only
when it is reasonably certain the lease period
\u00a0
will be extended. The lease liability is remeasured if
\u00a0
the lease term or lease payments change,
\u00a0
or there
are other modifications. Significant amounts paid up-front
\u00a0
on spectrum and other lease contracts are
\u00a0
recognised as prepayment until
Right-of-use assets are measured
\u00a0
at cost, less accumulated depreciation and impairments,
\u00a0
and adjusted for any remeasurement of lease
\u00a0
liabilities.
The right-of-use asset includes estimated costs for
\u00a0
dismantling and removing the underlying leased asset, restoring the
\u00a0
site on which it is located
or restoring the underlying leased asset to the
\u00a0
condition required by the terms and conditions of
\u00a0
the lease. Non-refundable value-added tax
\u00a0
is
included as initial direct cost. The right-of-use asset is
\u00a0
depreciated on a straight-line
\u00a0
basis over the shorter of its estimated
\u00a0
useful life and the lease
term. Right-of-use
\u00a0
assets where
\u00a0
it is reasonably
\u00a0
certain that
\u00a0
Telenor will
\u00a0
exercise
\u00a0
a purchase
\u00a0
option at
\u00a0
the end of
\u00a0
the lease
\u00a0
term are
\u00a0
not
depreciated.
Key judgments
\u00a0
and estimates
Determining the lease term can involve significant judgment
\u00a0
for lease contracts with extension or
\u00a0
termination options, as an assessment of
whether or
\u00a0
not it is
\u00a0
reasonably
\u00a0
certain that
\u00a0
the lease
\u00a0
period will
\u00a0
be extended
\u00a0
is required.
\u00a0
The broader
\u00a0
economics
\u00a0
of the contract
\u00a0
and not
\u00a0
only
contractual termination payments are basis for such
\u00a0
assessment. For lease of land for own towers or
\u00a0
leasing of towers from tower companies or
other operators,
\u00a0
factors considered
\u00a0
in particular
\u00a0
for assessing
\u00a0
the lease
\u00a0
term are
\u00a0
technology
\u00a0
development
\u00a0
and potential
\u00a0
changes in
\u00a0
business
models.
\u00a0
Based on
\u00a0
an assessment
\u00a0
of these
\u00a0
factors,
\u00a0
the lease
\u00a0
term for Telenor\u2019s
\u00a0
leases relating
\u00a0
to sites will
\u00a0
normally
\u00a0
be within
\u00a0
a range of
\u00a0
4 to 7 years.
This means
\u00a0
that the lease
\u00a0
term for
\u00a0
sites with
\u00a0
renewal
\u00a0
options shall
\u00a0
normally
\u00a0
be the higher
\u00a0
of a non-cancellable
\u00a0
period or
\u00a0
within a
\u00a0
range of
\u00a0
4 to 7
years. Some sites may be in strategically important
\u00a0
locations and it might be more than
\u00a0
reasonably certain that the sites will be maintained
\u00a0
beyond
7 years.
\u00a0
In these exceptional
\u00a0
cases, the
\u00a0
lease term
\u00a0
may be up
\u00a0
to 10 years.
Key judgments
\u00a0
and estimates
Depreciation expenses are based on management\u2019s estimates of
\u00a0
depreciation method, useful life and residual value. Estimates
\u00a0
may change due to
technological developments, competition, changes in market conditions,
\u00a0
geopolitical developments, climate change and other factors.
\u00a0
In
particular, technological developments are difficult to predict
\u00a0
as trends and pace of development may
\u00a0
change over time. The asset retirement
obligation
\u00a0
(ARO) is a
\u00a0
significant
\u00a0
estimate as
\u00a0
there is
\u00a0
significant
\u00a0
uncertainty
\u00a0
related
\u00a0
to the timing
\u00a0
of the removal
\u00a0
and restoration
\u00a0
of the sites,
\u00a0
and also
whether the restoration actually will take place. There
\u00a0
is also significant uncertainty related to future
\u00a0
price development as the work will take
\u00a0
place
well into
\u00a0
the future.
\u00a0
See note
\u00a0
22 for further
\u00a0
information
\u00a0
about the
\u00a0
asset removal
\u00a0
obligation.
\u00a0
Climate changes
\u00a0
can potentially
\u00a0
lead to destruction
\u00a0
of
assets from flooding, fires or other natural
\u00a0
disasters. Climate changes and increased focus on
\u00a0
sustainable businesses may impact technological
development, markets and economic or legal environment which
\u00a0
are critical estimates in the evaluations of
\u00a0
useful lives. A change in estimated
useful life
\u00a0
is a change
\u00a0
in accounting
\u00a0
estimate,
\u00a0
and depreciation
\u00a0
plans are
\u00a0
adjusted
\u00a0
prospectively.
\u00a0
Refer to
\u00a0
note 18 for
\u00a0
further information
\u00a0
about
impairment.
Key judgments
\u00a0
and estimates
Provisions
\u00a0
are estimated
\u00a0
based on
\u00a0
a number
\u00a0
of assumptions
\u00a0
and are
\u00a0
highly uncertain
\u00a0
in nature.
\u00a0
In particular,
\u00a0
the amounts
\u00a0
related
\u00a0
to legal
\u00a0
disputes
can be significant and the assessment of
\u00a0
probability and the possible outcome include highly
\u00a0
judgmental and complex assessments made by
management. Further, there is significant uncertainty related to
\u00a0
the timing of the asset retirement obligation
\u00a0
to occur, as the removal and
restoration of the sites will occur well into
\u00a0
the future and strategy, technological developments, markets
\u00a0
and other factors may impact the timing.
There is
\u00a0
also significant
\u00a0
uncertainty
\u00a0
related
\u00a0
to the asset
\u00a0
removal cost
\u00a0
due to uncertain
\u00a0
future price
\u00a0
development
\u00a0
and possibility
\u00a0
of negotiations
\u00a0
of
prices for
\u00a0
a large
\u00a0
number of
\u00a0
removals.
\u00a0
Further, there
\u00a0
is potentially
\u00a0
agreements
\u00a0
that relief
\u00a0
Telenor from
\u00a0
its obligations
\u00a0
and also uncertainty
\u00a0
as to
whether the
\u00a0
restoration
\u00a0
actually
\u00a0
will take
\u00a0
place. Due
\u00a0
to these uncertainties,
\u00a0
the actual
\u00a0
costs for
\u00a0
legal claims
\u00a0
and asset
\u00a0
retirement
\u00a0
obligations
\u00a0
may be
significantly
\u00a0
different
\u00a0
that current
\u00a0
estimates.
Key judgments
\u00a0
and estimates
There is significant uncertainty related to predicting
\u00a0
the outcome of legal proceedings, disputes and claims. The
\u00a0
potential obligations can represent
significant
\u00a0
amounts, the
\u00a0
disputes
\u00a0
may involve
\u00a0
complex assessments
\u00a0
of contracts
\u00a0
and legislation,
\u00a0
and political
\u00a0
and country
\u00a0
risk is
\u00a0
high in certain
disputes. Due to these uncertainties, the future
\u00a0
actual costs for legal disputes may be
\u00a0
significantly different than current estimates. Management
evaluates the degree of probability of
\u00a0
an unfavourable outcome and the ability to
\u00a0
make a reasonable estimate of the amount
\u00a0
of loss. Unanticipated
events or
\u00a0
changes
\u00a0
in these
\u00a0
factors may
\u00a0
require
\u00a0
management
\u00a0
to accrue
\u00a0
for a matters
\u00a0
that become
\u00a0
probable
\u00a0
or reliable,
\u00a0
or change
\u00a0
a provision
accrued for in a previous reporting period.
Key judgments
\u00a0
and estimates
The preparation of consolidated financial statements of Telenor
involves significant
\u00a0
judgements
\u00a0
and estimates
\u00a0
that could
\u00a0
result in
material adjustments to the carrying amount of
\u00a0
the asset or liability the
next financial year. Management is required to make
\u00a0
difficult, subjective
and complex
\u00a0
assessments
\u00a0
of the outcome
\u00a0
of matters
\u00a0
that are
inherently uncertain on an ongoing basis. The key
\u00a0
judgments and
estimates
\u00a0
are based
\u00a0
on historical
\u00a0
results and
\u00a0
experience,
\u00a0
consultations
with experts,
\u00a0
trends, forecasts
\u00a0
and scenarios
\u00a0
of future
\u00a0
development
and other methods which management considers reasonable
\u00a0
under the
circumstances.
\u00a0
Information about key judgments and estimates are
included in the individual notes. The following notes
\u00a0
include the most
significant judgments and estimates in the consolidated
\u00a0
financial
statements
\u00a0
of Telenor:
\u25cf
Note 10 Income
\u00a0
taxes
\u25cf
Note 14 Goodwill
\u25cf
Note 16 Right-of-use
\u00a0
assets
\u25cf
Note 17 Property,
\u00a0
plant and
\u00a0
equipment
\u25cf
Note 18 Impairment
\u00a0
of assets
\u25cf
Note 22 Provisions
\u00a0
and obligations
\u25cf
Note 23 Legal disputes and contingencies
Key judgments
\u00a0
and estimates
In mobile
\u00a0
swap contracts,
\u00a0
there is
\u00a0
an uncertainty
\u00a0
when and
\u00a0
if the customer
\u00a0
will exercise
\u00a0
the option
\u00a0
to cancel
\u00a0
the current
\u00a0
contract and
\u00a0
enter into
\u00a0
a
new. As the transaction price at inception
\u00a0
of the contract is based on an
\u00a0
estimate of payments received,
\u00a0
the revenue is a variable consideration.
The total consideration to be received is
\u00a0
estimated based on the expected value approach using
\u00a0
historical data.
\u00a0
In some markets
\u00a0
with mobile
\u00a0
swap contracts,
\u00a0
Telenor
\u00a0
is obliged
\u00a0
to accept
\u00a0
return of
\u00a0
the original
\u00a0
handset and
\u00a0
a refund
\u00a0
liability
\u00a0
is recognised.
\u00a0
In other
markets, an external third party takes ownership
\u00a0
of the device, resells it and guarantee a
\u00a0
compensation to Telenor. In these contracts, Telenor
consider
\u00a0
the guaranteed
\u00a0
amount from
\u00a0
the third
\u00a0
party as
\u00a0
part of the
\u00a0
total consideration
\u00a0
to be received
\u00a0
at inception
\u00a0
of the contract.
Disaggregation
\u00a0
of revenues
\u00a0
from contract
\u00a0
with customers
Revenues
\u00a0
are disaggregated
\u00a0
by major revenue
\u00a0
streams divided
\u00a0
into the reportable
\u00a0
segments
\u00a0
as shown
\u00a0
in note 2
\u00a0
in the table
\u00a0
below.
Key judgments
\u00a0
and estimates
\u00a0
Significant judgements are required when assessing uncertain
\u00a0
tax assets, like tax losses carried forward. Such
\u00a0
judgment may include assessment
of taxable
\u00a0
profits in
\u00a0
futures years
\u00a0
as well
\u00a0
as tax planning
\u00a0
strategies
\u00a0
and the existence
\u00a0
of taxable
\u00a0
temporary
\u00a0
differences.
\u00a0
Entities
\u00a0
with a history
\u00a0
of
recent losses need convincing evidence that sufficient
\u00a0
future taxable profit will be generated before a tax
\u00a0
asset is recognised. Uncertainty related
to new transactions
\u00a0
and events
\u00a0
and the
\u00a0
interpretation
\u00a0
of new tax
\u00a0
rules may
\u00a0
also affect
\u00a0
these judgements.
Telenor is involved in various legal proceedings, disputes
\u00a0
and claims related to its income tax positions
\u00a0
where the outcomes is subject to significant
uncertainty. The management assessment may include interpretation
\u00a0
of relevant laws, regulations, and the outcome
\u00a0
of similar tax disputes in the
same jurisdiction, expert opinions from external tax
\u00a0
advisors and communication with the tax authorities.
\u00a0
A tax provision is recognised when an
unfavourable outcome is considered probable, and a
\u00a0
reliable estimate can be made. In Norway,
\u00a0
a formal decision made by the tax
\u00a0
authorities or
lower courts is presumed to represent the
\u00a0
best estimate for accounting purposes unless expert
\u00a0
opinions can point to errors clearly
\u00a0
indicating that
the tax assessment is incorrect. The tax
\u00a0
provision is updated whenever the assumptions change.
\u00a0
Tax disputes are disclosed in this note if they
\u00a0
are
considered
\u00a0
significant
\u00a0
for Telenor.
\u00a0
See also
\u00a0
note 23 Legal
\u00a0
Disputes
\u00a0
and contingencies.
Key judgments
\u00a0
and estimates
Significant management judgment is used when assessing
\u00a0
impairment triggers at each reporting date. The
\u00a0
following factors are assessed:
significant
\u00a0
fall in market
\u00a0
values; significant
\u00a0
underperformance
\u00a0
relative
\u00a0
to historical
\u00a0
or projected
\u00a0
future operating
\u00a0
results;
\u00a0
significant
\u00a0
changes in
\u00a0
the
use of the
\u00a0
assets or
\u00a0
the strategy
\u00a0
for the overall
\u00a0
business,
\u00a0
including
\u00a0
assets that
\u00a0
are decided
\u00a0
to be phased
\u00a0
out or replaced
\u00a0
and assets that
\u00a0
are
damaged or taken out of use; significant
\u00a0
negative industry or economic trends; significant loss of
\u00a0
market share; significant adverse political and/or
regulatory development including unfavourable court decisions and significant
\u00a0
cost overruns in the development of assets.
The assessment of value-in-use
\u00a0
includes significant management judgments and estimates, including determining
\u00a0
the discount rate (WACC),
estimating future performance, revenue generating capacity of
\u00a0
the assets, margins, prices on future renewals
\u00a0
of spectrum licences, political and
regulatory risk, required maintenance capex, network costs
\u00a0
and technological developments, and assumptions of the
\u00a0
future market conditions.
There are significant variations between different markets
\u00a0
with respect to growth, mobile penetration,
\u00a0
average revenue per user (ARPU),
\u00a0
market
share, inflation, regulatory costs, and technological development,
\u00a0
resulting in differences in EBITDA margins, future investments,
\u00a0
and long terms
growth assumptions. In some markets, certain expenses
\u00a0
and capex are denominated in foreign currency and
\u00a0
impacted by currency fluctuations.
Recessionary effects and increased macroeconomic risks may
\u00a0
impact the estimates of growth, future performance
\u00a0
and discount rates used in
estimating recoverable amounts of assets. Discount
\u00a0
rates are impacted by several macroeconomic factors
\u00a0
including borrowing rates, country risk,
inflation assumptions and currency development. For assumptions
\u00a0
used, external evidence has been taken into consideration.
Climate-related
\u00a0
risks
Telenor is exposed to climate-related
\u00a0
physical risks such as potential damage to
\u00a0
infrastructure and utilities through the impact of
\u00a0
more extreme
weather events
\u00a0
and rising
\u00a0
sea levels.
\u00a0
Climate-related
\u00a0
regulatory
\u00a0
risks include
\u00a0
potentially
\u00a0
higher operational
\u00a0
costs due
\u00a0
to increasing
\u00a0
carbon taxes
and energy/fuel
\u00a0
taxes, as
\u00a0
well as
\u00a0
risks of higher
\u00a0
capital expenditures
\u00a0
due to a
\u00a0
required
\u00a0
transition
\u00a0
towards the
\u00a0
use of renewable
\u00a0
energy solutions
\u00a0
and
energy efficient
\u00a0
networks.
\u00a0
Climate-related
\u00a0
risks are
\u00a0
considered
\u00a0
in the cash
\u00a0
flow projections.
\u00a0
Cash flows
Discounted
\u00a0
cash flow
\u00a0
models have
\u00a0
been applied
\u00a0
to determine
\u00a0
the value-in-use
\u00a0
for cash-generating
\u00a0
units.
\u00a0
The cash
\u00a0
flows are
\u00a0
based on the
\u00a0
most
recent financial forecasts approved by management. Management has
\u00a0
projected cash flows based on financial forecasts and
\u00a0
strategy plans
covering the period 2023-2025
\u00a0
for DNA and Telenor Pakistan.
\u00a0
The cash flows beyond the explicit forecast
\u00a0
period have been extrapolated into
perpetuity
\u00a0
using a
\u00a0
constant nominal
\u00a0
growth rate
\u00a0
to arrive
\u00a0
at the terminal
\u00a0
value. The
\u00a0
estimates
\u00a0
of value
\u00a0
in use have
\u00a0
been compared
\u00a0
to market
valuation
\u00a0
and multiples
\u00a0
for peers
\u00a0
in the telecommunication
\u00a0
business
\u00a0
for reasonableness.
\u00a0
The expected growth in revenue, EBITDA, and
\u00a0
EBITDA margin for a cash-generating unit
\u00a0
is based on historical performance, expected
development in the market in which the entity
\u00a0
operates and assumptions in terms of development
\u00a0
in market share. The growth rates applied
\u00a0
in the
explicit forecast period converge from its current level
\u00a0
experienced over the last few years to the
\u00a0
long-term growth level in the market where
\u00a0
the
entity operates. The growth rates used to
\u00a0
extrapolate cash flow projections beyond the explicit forecast
\u00a0
period are not higher than the average
expected long-term growth in the markets in which
\u00a0
the entities operate. In periods with relatively
\u00a0
low discount rates, the estimated growth rates
used in the projections might be determined
\u00a0
significantly below the average expected long term growth observed
\u00a0
in the market.
Average revenue per user (ARPU)
\u00a0
ARPU is a measure for average revenue
\u00a0
per subscription per month, which is a key
\u00a0
component when estimating revenue growth. ARPU is
calculated based on mobile revenues from the
\u00a0
company\u2019s own subscriptions, divided by the average number
\u00a0
of subscriptions for the relevant
period. ARPU is estimated based on the current
\u00a0
ARPU level and expected
\u00a0
future market development.
EBITDA margin
1)
The EBITDA margin is estimated based on the
\u00a0
current margin level and expected future market development.
\u00a0
Committed or implemented
operational efficiency programmes are included. Changes in
\u00a0
the outcome of these initiatives may affect
\u00a0
future estimated EBITDA margins.
\u00a0
Capital expenses
\u00a0
(capex)
1)
\u00a0
and spectrum licences
\u00a0
A normalised level of capex as a percentage
\u00a0
of revenues (capex/revenues) is assumed in the
\u00a0
long run. Changes in traffic volumes and
\u00a0
number of
subscriptions during a growth phase
\u00a0
will affect the future capex/revenues
\u00a0
ratio. Estimated capex reflect the level of
\u00a0
capex needed for maintaining
current operation.
\u00a0
Costs related
\u00a0
to future spectrum
\u00a0
acquisitions
\u00a0
are estimated
\u00a0
based on
\u00a0
historical
\u00a0
levels of
\u00a0
spectrum costs
\u00a0
compared
\u00a0
to revenue
Included in the assessment of future spectrum
\u00a0
prices.
\u00a0
Telenor also takes into consideration the development in
\u00a0
neighbouring countries
\u00a0
and more
advanced markets for potential spectrum auctions in
\u00a0
emerging markets.
\u00a0
Discount rates are based on Weighted Average
\u00a0
Cost of Capital (WACC) derived from the Capital
\u00a0
Asset Pricing Model (CAPM) methodology. The
cost is derived from its weighted average cost
\u00a0
of capital. In economies where the Group
\u00a0
considers risk-free yields to be
\u00a0
unreliable, the WACC rates
used in discounting the future cash flows
\u00a0
are based on a US 30-year risk-free
\u00a0
interest rate, adjusted with a country risk
\u00a0
premium and the inflation
differential between the US and the relevant
\u00a0
country. The discount rates consider the debt
\u00a0
premium, market risk premium, gearing, corporate tax
rate, inflation, and asset beta. For cash-generating
\u00a0
units in economies with unstable inflation rates,
\u00a0
rolling discount rates are applied.
\u00a0
1)
Please refer to page 180 for description of alternative
\u00a0
performance measures.
\u00a0
Cash-generating
\u00a0
units (CGUs)
\u00a0
with significant
\u00a0
goodwill
The goodwill
\u00a0
allocated
\u00a0
to each CGU
\u00a0
is shown in
\u00a0
note 14.
\u00a0
The recoverable
\u00a0
amounts for
\u00a0
the cash-generating
\u00a0
units with
\u00a0
significant
\u00a0
goodwill
\u00a0
have been
determined based on the following discount rates
\u00a0
and terminal value nominal growth rates for
\u00a0
the years 2022 and 2021:
Discount
\u00a0
rate after tax
\u00a0
(%)
Discount
\u00a0
rate pre-tax
\u00a0
(%)
Nominal growth
\u00a0
in cash flow
\u00a0
in terminal
\u00a0
value (%)
2022
2021
2022
2021
2022
2021
Telenor Sweden
6.7
5.0
8.5
6.4
1.9
0.0
DNA
6.8
5.0
8.5
6.3
2.3
0.75
In the recoverable
\u00a0
amount assessment,
\u00a0
the Group
\u00a0
has applied
\u00a0
estimated
\u00a0
cash flows
\u00a0
after tax
\u00a0
and corresponding
\u00a0
discount rates
\u00a0
after tax.
\u00a0
The
recoverable amounts would not change significantly if
\u00a0
pre-tax cash flows and pre-tax discount rates
\u00a0
had been applied instead.
\u00a0
The war
\u00a0
in Ukraine
\u00a0
has generated
\u00a0
a sharp increase
\u00a0
in energy
\u00a0
prices following
\u00a0
the shortage
\u00a0
of supply,
\u00a0
and there
\u00a0
is increased
\u00a0
risk of supply
\u00a0
chain
disruption due to escalating trade tension and sanctions.
\u00a0
The risk related to continued high energy prices
\u00a0
and general inflation caused by the war is
reflected
\u00a0
in the forecasts
\u00a0
used as
\u00a0
basis for
\u00a0
the value
\u00a0
in use calculation.
,
Key judgments
\u00a0
and estimates
Trade receivables and contract assets are adjusted
\u00a0
for provision for impairment in accordance with
\u00a0
the expected credit loss model. The simplified
approach
\u00a0
is applied
\u00a0
measuring
\u00a0
the loss allowance
\u00a0
at an amount
\u00a0
equal to
\u00a0
lifetime
\u00a0
expected
\u00a0
credit losses.
\u00a0
Impairment
\u00a0
for expected
\u00a0
credit losses
\u00a0
is
assessed every reporting period and calculated by considering
\u00a0
the historic evidence of the level of
\u00a0
bad debt experienced for customer types and
the aging of the receivable balance.
Key judgments
\u00a0
and estimates
The present value of the pension obligations
\u00a0
depends on a number of actuarial assumptions, including
\u00a0
the discount rate, expected salary growth,
inflation and return on assets as well
\u00a0
as demographical factors concerning mortality, employee turnover,
\u00a0
disability and early retirement.
Assumptions
\u00a0
about all
\u00a0
these factors
\u00a0
are based
\u00a0
on the situation
\u00a0
at the time
\u00a0
the assessment
\u00a0
is made,
\u00a0
whereas it
\u00a0
is expected
\u00a0
that such factors
\u00a0
will
change over
\u00a0
the long
\u00a0
periods for
\u00a0
which pension
\u00a0
calculations
\u00a0
are made.
\u00a0
Any changes
\u00a0
in these assumptions
\u00a0
will affect
\u00a0
the calculated
\u00a0
pension
obligations with immediate recognition in other comprehensive
\u00a0
income.
Key judgments
\u00a0
and estimates
The fair value assessment of assets and
\u00a0
liabilities in a business combination usually include
\u00a0
significant judgments and estimates, as valuation
techniques can include assumptions on future revenues,
\u00a0
net income, outcome of legal claims and
\u00a0
many other variables. Telenor always use
external
\u00a0
valuation
\u00a0
experts to
\u00a0
assess the
\u00a0
fair value
\u00a0
of assets
\u00a0
and liabilities
\u00a0
in significant
\u00a0
business combinations.
\u00a0
Further,
\u00a0
the impairment
\u00a0
testing of
goodwill
\u00a0
includes
\u00a0
a variety
\u00a0
of key judgments
\u00a0
and estimates
\u00a0
made by
\u00a0
management.
\u00a0
See further
\u00a0
description
\u00a0
in note 18
\u00a0
Impairment.
Key judgments
\u00a0
and estimates
Amortisation expenses are based on management\u2019s estimates of
\u00a0
amortisation method, useful life and residual value.
\u00a0
Estimates may change due to
technological developments, changed competition or market conditions,
\u00a0
geopolitical developments and other factors. In particular,
\u00a0
technological
developments
\u00a0
are difficult
\u00a0
to predict
\u00a0
as trends
\u00a0
and pace
\u00a0
of development
\u00a0
may change
\u00a0
over time.
\u00a0
Estimated
\u00a0
useful lives
\u00a0
for similar
\u00a0
types of assets
may vary
\u00a0
between
\u00a0
different
\u00a0
entities due
\u00a0
to factors
\u00a0
such as growth
\u00a0
rate, maturity
\u00a0
of the market,
\u00a0
history and
\u00a0
expectations
\u00a0
for replacements
\u00a0
or
transfer of
\u00a0
assets, climate
\u00a0
and quality
\u00a0
of the technology
\u00a0
used. A change
\u00a0
in estimated
\u00a0
useful life
\u00a0
is a change
\u00a0
in accounting
\u00a0
estimate,
\u00a0
and
amortisation plans are adjusted prospectively. Refer to
\u00a0
note 18 for further information about impairment.
NOTE 17
Property, plant and equipment
The majority of the property, plant and equipment (PPE) in Telenor relate
\u00a0
to investments in network equipment and
infrastructure, including base stations, cables, fiber
\u00a0
and radio equipment.
\u00a0
Other assets include equipment for
cable TV and satellites in addition to buildings, land and administrative
\u00a0
assets.
\u00a0
Accounting policies
Property, plant and equipment are recognised at
\u00a0
cost less accumulated depreciation and any impairment
\u00a0
losses.
\u00a0
The cost includes borrowing
costs for
\u00a0
qualifying
\u00a0
assets.
\u00a0
If Telenor
\u00a0
has a legal
\u00a0
or constructive
\u00a0
obligation
\u00a0
to dismantle,
\u00a0
remove
\u00a0
and restore
\u00a0
a site, an
\u00a0
asset retirement
\u00a0
obligation
(ARO) is recognized with a corresponding increase in the
\u00a0
related asset within property, plant and equipment.
\u00a0
AROs primarily relate to base stations
and installed network and infrastructure equipment in
\u00a0
addition to some buildings, refer to note
\u00a0
22 for further information. Estimated useful lives for
similar types of assets may vary between
\u00a0
different geographical areas due to factors such
\u00a0
as growth rate, maturity of the market,
\u00a0
history and
expectations for replacements or transfer of assets,
\u00a0
climate and quality of components used. Estimated useful
\u00a0
life, depreciation method and
residual
\u00a0
value are
\u00a0
evaluated
\u00a0
at least annually.
\u00a0
The straight-line
\u00a0
depreciation
\u00a0
method is
\u00a0
used as this
\u00a0
best reflects
\u00a0
the consumption
\u00a0
of the assets,
which often is the passage of time.
\u00a0
Residual value is estimated to be zero for
\u00a0
most assets, except for some commercial buildings
\u00a0
and vehicles that
are not expected to be used for
\u00a0
the whole economic life. Refer to note
\u00a0
18 for further information about impairment.
Key judgments
\u00a0
and estimates
Depreciation expenses are based on management\u2019s estimates of
\u00a0
depreciation method, useful life and residual value. Estimates
\u00a0
may change due to
technological developments, competition, changes in market conditions,
\u00a0
geopolitical developments, climate change and other factors.
\u00a0
In
particular, technological developments are difficult to predict
\u00a0
as trends and pace of development may
\u00a0
change over time. The asset retirement
obligation
\u00a0
(ARO) is a
\u00a0
significant
\u00a0
estimate as
\u00a0
there is
\u00a0
significant
\u00a0
uncertainty
\u00a0
related
\u00a0
to the timing
\u00a0
of the removal
\u00a0
and restoration
\u00a0
of the sites,
\u00a0
and also
whether the restoration actually will take place. There
\u00a0
is also significant uncertainty related to future
\u00a0
price development as the work will take
\u00a0
place
well into
\u00a0
the future.
\u00a0
See note
\u00a0
22 for further
\u00a0
information
\u00a0
about the
\u00a0
asset removal
\u00a0
obligation.
\u00a0
Climate changes
\u00a0
can potentially
\u00a0
lead to destruction
\u00a0
of
assets from flooding, fires or other natural
\u00a0
disasters. Climate changes and increased focus on
\u00a0
sustainable businesses may impact technological
development, markets and economic or legal environment which
\u00a0
are critical estimates in the evaluations of
\u00a0
useful lives. A change in estimated
useful life
\u00a0
is a change
\u00a0
in accounting
\u00a0
estimate,
\u00a0
and depreciation
\u00a0
plans are
\u00a0
adjusted
\u00a0
prospectively.
\u00a0
Refer to
\u00a0
note 18 for
\u00a0
further information
\u00a0
about
impairment.
Property, plant
\u00a0
and equipment
NOK in millions
Local,
and trunk
networks
Mobile
telephone
network
Subscribe
r
equipmen
t
Switches
and equip-
ment
Radio
installa-
tions
Cable-TV
equipmen
t
Buildings
Land
Corporate
adminis-
trative
assets
Satellites
Work in
progress
1)
Total
As of 1 January 2021
64 248
40 324
2 651
15 785
46 725
6 502
7 229
686
11 383
5 021
6 814
207 369
Reclassifications
2)
1 890
3 014
195
484
3 270
84
(560)
3
(106)
-
(7 839)
436
Additions
1 653
792
752
367
1 784
65
35
2
703
(14)
8 749
14 888
Translation differences
(1 187)
(1 685)
(65)
(403)
(1 920)
(59)
(127)
(28)
(381)
-
(223)
(6 079)
Derecognitions
(869)
(1 645)
(504)
(1 219)
(2 271)
(28)
(155)
(3)
(872)
-
(7)
(7 574)
Reclassified to assets held for
sale
(2 064)
(1 564)
(1)
(484)
(3 751)
(272)
(36)
-
(465)
-
(167)
(8 804)
As of 31
\u00a0
December
\u00a0
2021
63 671
39 236
3 028
14 530
43 837
6 293
6 386
660
10 262
5 007
7 326
200 235
Reclassifications
2)
1 321
2 496
(15)
283
2 294
34
(548)
(40)
702
-
(6 551)
(24)
Additions
1 842
547
582
361
2 438
48
90
18
771
-
7 093
13 789
Translation differences
542
109
(21)
(47)
397
(19)
30
7
(85)
-
39
953
Derecognitions
(5 420)
(8 952)
(837)
(3 027)
(10 574)
(371)
(464)
(67)
(1 945)
-
(408)
(32 064)
As of 31
\u00a0
December
\u00a0
2022
61 956
33 435
2 737
12 099
38 393
5 985
5 494
578
9 705
5 007
7 500
182 888
Accumulated depreciation and impairment losses
As of 1 January 2021
(40 166)
(23 439)
(1 431)
(13 642)
(28 912)
(4 252)
(4 797)
(4)
(7 913)
(3 442)
-
(128 001)
Reclassifications
2)
(402)
(448)
(9)
(2)
(397)
-
381
1
641
-
-
(236)
Depreciation - continuing
operations
(2 705)
(2 924)
(823)
(675)
(4 289)
(395)
(244)
-
(643)
(206)
-
(12 905)
Depreciation - discontinued
operations
(297)
(763)
-
(141)
(380)
-
(7)
-
(103)
-
-
(1 691)
Impairment - discontinued
operations
(641)
(817)
-
(43)
(1 488)
-
(15)
-
(215)
-
(176)
(3 395)
Translation differences
503
935
48
325
1 180
38
74
1
227
-
-
3 331
Derecognition
862
1 559
504
1 218
2 257
27
123
-
811
-
-
7 361
Reclassified to assets held for
sale
1 463
1 562
1
484
3 746
135
36
-
465
-
176
8 067
As of 31
\u00a0
December
\u00a0
2021
(41 383)
(24 335)
(1 711)
(12 475)
(28 283)
(4 447)
(4 451)
(2)
(6 733)
(3 648)
-
(127 468)
Reclassifications
2)
(119)
(583)
91
34
39
-
541
-
2
-
-
4
Depreciation - continuing
operations
(2 565)
(2 724)
(862)
(674)
(4 353)
(309)
(210)
-
(780)
(202)
-
(12 681)
Depreciation - discontinued
operations
(243)
(573)
-
(120)
(225)
-
(6)
-
(65)
-
-
(1 231)
Impairment - continuing
operations
(179)
(606)
-
(103)
(399)
-
(108)
(38)
(77)
-
-
(1 509)
Translation differences
(78)
123
15
67
(145)
14
(17)
3
129
-
-
110
Derecognition
4 234
6 259
836
2 657
9 235
369
195
-
1 762
-
-
25 546
As of 31
\u00a0
December
\u00a0
2022
(40 332)
(22 440)
(1 631)
(10 615)
(24 132)
(4 373)
(4 056)
(38)
(5 762)
(3 850)
-
(117 229)
As of 31
\u00a0
December
\u00a0
2022
21 623
10 995
1 106
1 485
14 260
1 612
1 438
540
3 943
1 157
7 500
65 659
As of 31
\u00a0
December
\u00a0
2021
22 287
14 901
1 317
2 055
15 554
1 846
1 935
658
3 529
1 359
7 326
72 767
Depreciation periods, years
3)
3-30
5-20
3
3-7
5-15
3-15
5-30
-
2-10
17
-
-
1)
The Additions line items represent net additions
\u00a0
of work in progress during the financial year. Work
\u00a0
in progress capitalised and activated within
\u00a0
the same
financial year is shown as Additions in the relevant
\u00a0
asset categories in this table.
2)
Including reclassifications to/from other lines in the statement
\u00a0
of financial position which is not a part of this
\u00a0
table.
3)
Asset categories presented in this movement schedule
\u00a0
is an aggregated total from different asset components
\u00a0
belonging to a particular category, and the
disclosed depreciation rates represent a range of useful
\u00a0
lives allocated to components.
NOTE 16
Right-of-use assets
Telenor has chosen to account for the right to use the spectrum as a lease,
\u00a0
where the identified asset is the
frequency band that is exclusive for Telenor in the lease period. Telenor
\u00a0
also leases passive infrastructure such as
towers and cables in addition to land and property. Refer to 29 for
\u00a0
more information about lease liabilities.
\u00a0
Accounting policies
A lease
\u00a0
liability
\u00a0
and a right-of-use
\u00a0
asset is
\u00a0
recognised
\u00a0
at commencement
\u00a0
date in
\u00a0
lease contracts
\u00a0
where Telenor
\u00a0
has the right
\u00a0
to direct
\u00a0
the use and
obtains substantially
\u00a0
all the economic
\u00a0
benefits
\u00a0
from the
\u00a0
use of an
\u00a0
identified
\u00a0
asset. For
\u00a0
spectrum
\u00a0
contracts,
\u00a0
Telenor
\u00a0
has chosen
\u00a0
to account
\u00a0
for the
right to
\u00a0
use the spectrum
\u00a0
as a lease,
\u00a0
where the
\u00a0
identified
\u00a0
asset is
\u00a0
the frequency
\u00a0
band that
\u00a0
is exclusive
\u00a0
for Telenor
\u00a0
during the
\u00a0
lease period.
\u00a0
Lease
payments on short-term leases
\u00a0
(less than 12 months) and low-value asset leases
\u00a0
(mainly office equipment) are generally expensed on
\u00a0
a straight-line
basis over the lease term. The short-term
\u00a0
exemption does not apply to spectrum leases or
\u00a0
leases with purchase options.
\u00a0
The lease liability represents the net present value
\u00a0
of lease payments over the lease period
\u00a0
and include fixed payments, in-substance fixed
payments, non-lease components, residual value
\u00a0
guarantees and lease incentives. The lease payments also
\u00a0
include the exercise price of a
purchase option reasonably certain to be exercised
\u00a0
and termination penalties when termination is expected.
\u00a0
Variable lease payments such as
licence payments based on revenue sharing arrangements
\u00a0
are expensed as incurred.
The incremental
\u00a0
borrowing
\u00a0
rate generally
\u00a0
used to determine
\u00a0
the net present
\u00a0
value is
\u00a0
based on
\u00a0
the respective
\u00a0
country\u2019s risk-free
\u00a0
rate for
\u00a0
the term
corresponding
\u00a0
to the lease term, adjusted for own
\u00a0
credit risk. Subsidiaries with external financing use
\u00a0
the external borrowing rate corresponding to
The non-cancellable lease period is basis for
\u00a0
the lease liability, and periods covered by
\u00a0
options to extend or terminate the lease are
\u00a0
included only
when it is reasonably certain the lease period
\u00a0
will be extended. The lease liability is remeasured if
\u00a0
the lease term or lease payments change,
\u00a0
or there
are other modifications. Significant amounts paid up-front
\u00a0
on spectrum and other lease contracts are
\u00a0
recognised as prepayment until
Right-of-use assets are measured
\u00a0
at cost, less accumulated depreciation and impairments,
\u00a0
and adjusted for any remeasurement of lease
\u00a0
liabilities.
The right-of-use asset includes estimated costs for
\u00a0
dismantling and removing the underlying leased asset, restoring the
\u00a0
site on which it is located
or restoring the underlying leased asset to the
\u00a0
condition required by the terms and conditions of
\u00a0
the lease. Non-refundable value-added tax
\u00a0
is
included as initial direct cost. The right-of-use asset is
\u00a0
depreciated on a straight-line
\u00a0
basis over the shorter of its estimated
\u00a0
useful life and the lease
term. Right-of-use
\u00a0
assets where
\u00a0
it is reasonably
\u00a0
certain that
\u00a0
Telenor will
\u00a0
exercise
\u00a0
a purchase
\u00a0
option at
\u00a0
the end of
\u00a0
the lease
\u00a0
term are
\u00a0
not
depreciated.
Key judgments
\u00a0
and estimates
Determining the lease term can involve significant judgment
\u00a0
for lease contracts with extension or
\u00a0
termination options, as an assessment of
whether or
\u00a0
not it is
\u00a0
reasonably
\u00a0
certain that
\u00a0
the lease
\u00a0
period will
\u00a0
be extended
\u00a0
is required.
\u00a0
The broader
\u00a0
economics
\u00a0
of the contract
\u00a0
and not
\u00a0
only
contractual termination payments are basis for such
\u00a0
assessment. For lease of land for own towers or
\u00a0
leasing of towers from tower companies or
other operators,
\u00a0
factors considered
\u00a0
in particular
\u00a0
for assessing
\u00a0
the lease
\u00a0
term are
\u00a0
technology
\u00a0
development
\u00a0
and potential
\u00a0
changes in
\u00a0
business
models.
\u00a0
Based on
\u00a0
an assessment
\u00a0
of these
\u00a0
factors,
\u00a0
the lease
\u00a0
term for Telenor\u2019s
\u00a0
leases relating
\u00a0
to sites will
\u00a0
normally
\u00a0
be within
\u00a0
a range of
\u00a0
4 to 7 years.
This means
\u00a0
that the lease
\u00a0
term for
\u00a0
sites with
\u00a0
renewal
\u00a0
options shall
\u00a0
normally
\u00a0
be the higher
\u00a0
of a non-cancellable
\u00a0
period or
\u00a0
within a
\u00a0
range of
\u00a0
4 to 7
years. Some sites may be in strategically important
\u00a0
locations and it might be more than
\u00a0
reasonably certain that the sites will be maintained
\u00a0
beyond
7 years.
\u00a0
In these exceptional
\u00a0
cases, the
\u00a0
lease term
\u00a0
may be up
\u00a0
to 10 years.
Right-of-use assets
Right-of-use assets are classified based
\u00a0
on the nature of underlying assets as follow:
NOK in millions
Spectrum
licences
1)
structure
Cables
Land
Buildings
Others
Total
As of 1 January 2021
53 423
20 464
5 851
5 618
4 167
116
89 638
Additions
4 403
2 999
213
748
452
200
9 015
Derecognition
( 93)
(1 121)
( 191)
( 453)
( 348)
( 40)
(2 246)
Reclassifications
( 2)
( 326)
-
238
87
-
( 2)
Translation differences
(2 930)
(1 405)
( 415)
( 299)
( 157)
-
(5 207)
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
(4 563)
(4 414)
(1 403)
( 105)
( 102)
( 6)
(10 594)
As of 31 December 2021
50 237
16 197
4 054
5 747
4 099
270
80 604
Additions
4 845
2 435
1 026
716
816
125
9 963
Derecognition
( 766)
(1 258)
( 291)
( 507)
( 330)
( 28)
(3 180)
Disposal of companies
(5 729)
(4 157)
( 25)
(1 271)
( 60)
( 2)
(11 243)
Reclassifications
1
( 99)
( 17)
-
( 20)
-
( 135)
Translation differences
287
133
( 160)
112
73
3
447
As of 31 December 2022
48 875
13 251
4 586
4 797
4 579
368
76 456
Accumulated
\u00a0
depreciation
As of 1 January 2021
(16 264)
(5 276)
(2 272)
(1 646)
(1 321)
( 46)
(26 826)
Amortisation - continuing operations
(3 073)
(2 365)
( 481)
( 769)
( 700)
( 60)
(7 447)
Amortisation - discontinued operations
( 368)
( 871)
( 133)
( 247)
( 25)
( 2)
(1 646)
Impairment - discontinued operations
(2 542)
-
-
-
-
-
(2 542)
Reassessment
\u00a0
of right-of-use
\u00a0
assets -
\u00a0
discontinued
operations
( 136)
(2 103)
( 720)
( 47)
( 40)
( 1)
(3 047)
Derecognition
93
572
180
278
312
34
1 469
Reclassifications
( 3)
15
( 2)
4
( 14)
-
-
Translation differences
795
391
121
92
70
4
1 473
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
4 543
3 651
1 150
89
88
5
9 526
As of 31 December 2021
(16 954)
(5 986)
(2 156)
(2 247)
(1 631)
( 66)
(29 040)
Amortisation - continuing operations
(3 341)
(2 289)
( 489)
( 780)
( 723)
( 76)
(7 690)
Amortisation - discontinued operations
( 281)
( 518)
( 6)
( 219)
( 12)
-
(1 036)
Impairment - continuing operations
-
( 576)
( 93)
( 272)
( 22)
-
( 963)
Derecognition
740
1 010
144
322
332
26
2 574
Disposal of companies
2 869
1 748
20
530
27
2
5 195
Reclassifications
( 18)
133
( 44)
-
19
-
90
Translation differences
85
( 4)
82
( 23)
( 34)
( 2)
105
As of 31 December 2022
(16 900)
(6 482)
(2 540)
(2 688)
(2 043)
( 116)
(30 770)
Carrying amount
As of 31 December 2021
33 283
10 211
1 898
3 500
2 468
204
51 565
As of 31 December 2022
31 975
6 769
2 046
2 109
2 535
251
45 686
Weighted
\u00a0
average remaining
\u00a0
lease term
As of 31 December 2021
1)
-
5
7
5
9
3
-
As of 31 December 2022
1)
-
5
7
4
9
3
-
Related lease liability disaggregated per class of
As of 31
\u00a0
December
\u00a0
2021
14 760
10 134
1 460
4 499
4 024
201
35 077
As of 31
\u00a0
December
\u00a0
2022
14 878
7 082
1 619
3 263
4 004
245
31 091
1)
See table below for overview spectrum licences,
\u00a0
including lease term.
For lease
\u00a0
of network
\u00a0
passive infrastructure
\u00a0
(lease of
\u00a0
tower space
\u00a0
in networks
\u00a0
and lease
\u00a0
of part of
\u00a0
buildings
\u00a0
for own towers),
\u00a0
land for
\u00a0
own sites
\u00a0
or
towers and lease of buildings for office spaces,
\u00a0
equipment and retail stores, lease agreements generally
\u00a0
contain termination options or renewal
options. These
\u00a0
options are
\u00a0
used to limit
\u00a0
the period
\u00a0
to which
\u00a0
Telenor is
\u00a0
committed
\u00a0
to individual
\u00a0
lease contracts
\u00a0
and to maximise
\u00a0
operational
flexibility in terms of dynamic network requirements. The remaining
\u00a0
non-cancellable period for lease contracts under
\u00a0
network passive
infrastructure is 3 years on average.
\u00a0
The non-cancellable period for lease contracts
\u00a0
related to land is 2 years on average, which
\u00a0
is mainly driven by
non-cancellable lease agreements in Thailand.
\u00a0
As a result of deteriorating macro-economic
\u00a0
situation in Pakistan, an impairment of NOK
\u00a0
963 million related to
\u00a0
right-of-use assets was recognised
in 2022. Please see note 18 for
\u00a0
further information.
\u00a0
In 2021, due to a worsening security and
\u00a0
human rights situation in Myanmar, Telenor made an
impairment
\u00a0
of the right
\u00a0
of use assets
\u00a0
and at the
\u00a0
same time
\u00a0
reassessed
\u00a0
the lease
\u00a0
term of all
\u00a0
the lease
\u00a0
agreements
\u00a0
in Myanmar,
\u00a0
limiting
\u00a0
the lease
term to one
\u00a0
year.
\u00a0
The additions
\u00a0
of spectrum
\u00a0
licences
\u00a0
in 2022 were
\u00a0
related to
\u00a0
additional
\u00a0
spectrum
\u00a0
fee of NOK
\u00a0
1.7 billion
\u00a0
in Pakistan,
\u00a0
which is
\u00a0
pursuant to
\u00a0
the Supreme
Court ruling there the detailed judgement is
\u00a0
still awaited, see further below and note
\u00a0
23 for more information. Moreover, the additions
\u00a0
were related
to acquisition of spectrum under 3500 MHz in
\u00a0
Norway, 2100 MHz in Denmark, and 2600 MHz in
\u00a0
Grameenphone. The additions of spectrum licences
in 2021 were primarily related to renewal
\u00a0
of spectrum under the 900 MHz and 1800
\u00a0
MHz bands in Pakistan, acquisition of spectrum under
\u00a0
1800 MHz
and 2100
\u00a0
MHz bands in Grameenphone, 3500 MHz band in
\u00a0
Sweden and 3500 MHz and 26 GHz bands
\u00a0
in Denmark.
In 2022,
\u00a0
the additions in network passive infrastructure were
\u00a0
mainly related to site leases from towercos
\u00a0
in Grameenphone, contract renewal of
CAT equipment lease in dtac, tower spaces
\u00a0
and part of building for own towers Telenor
\u00a0
Norway and Finland. The additions in cables were
\u00a0
mainly in
Sweden and Grameenphone.
\u00a0
The additions in building were mainly related
\u00a0
to Telenor Real Estate, Telenor South East Asia
\u00a0
Investment Pte Ltd.,
Telenor Sweden and Telenor Denmark. The additions in land
\u00a0
were mainly related to land for own sites
\u00a0
in dtac and Pakistan.
In 2021, the additions in network passive
\u00a0
infrastructure were mainly related to site leases from
\u00a0
towerco in Grameenphone, CAT equipment in dtac,
tower spaces and part of building for own
\u00a0
towers in Digi and Telenor Norway. The
\u00a0
additions in cables were mainly in Sweden. The additions in
building
\u00a0
were mainly
\u00a0
related to
\u00a0
dtac and
\u00a0
Telenor Infra.
\u00a0
The additions
\u00a0
in land
\u00a0
were mainly
\u00a0
related to
\u00a0
land for
\u00a0
own sites
\u00a0
in dtac,
\u00a0
Digi and
\u00a0
Pakistan.
For lease of spectrum, the agreements are
\u00a0
generally non-cancellable. Telenor has not considered periods
\u00a0
covered by renewal options even if in
some agreements
\u00a0
the option to renew exists, given the
\u00a0
uncertainty around terms and conditions of renewal
\u00a0
of licences.
The following table sets forth the spectrum
\u00a0
licences that Telenor holds as of 31 December
\u00a0
2022:
Spectrum (MHz)
Spectrum expiration
Telenor Norway
700
2x10
2039
800
2\u00d710
2033
900
2\u00d715
2033
1800
2\u00d710 + 2\u00d720
2028/2033
2100
2\u00d720
2032
3500
120
2042
Telenor Sweden
700
2x10
1)
2040
800
2x10
1)
2035
900
2x6
1)
2025
1800
2\u00d720
1)
1)
2027/2037
2100
2x10
1),3)
\u00a0
+ 2\u00d79.8 +
\u00a0
5
2025
2600
2x40
2)
2025
3500
100
1)
2045
Telenor Denmark
700
2x5
4)
2040
800
2x10
4)
2034
900
2x10
4)
2034
1500
45
4)
2042
1800
2\u00d725
4)
2032
2100
2\u00d715 + 1\u00d75
2022
2100
2\u00d720
4)
2042
2600
2\u00d720 + 10
2030
3500
140
4)
2042
26000
600
4)
2042
DNA, Finland
700
2x10
2033
800
2x10
2033
900
2x11.6
2033
1800
2x24.8
2033
2100
2x19.8
2033
2600
2x20
2029
3500
130
2033
26000
800
2033
dtac, Thailand
700
2x10
2035
900
2x5
2033
1800
2\u00d75
2033
2100
2x15
2027
2300
60
5)
2025
26000
200
2035
Grameenphone, Bangladesh
900
2\u00d77.4
2026
1800
2\u00d77.4
2026
1800
2\u00d77.2
2026
1800
2x5
2033
1800
2x0.4
2026
2100
2\u00d710
2028
2100
2\u00d710
2026
2600
60
2033
Telenor Pakistan
850
2x10
2031
900
2\u00d74.8
2034
1800
2\u00d78.8
2034
2100
2\u00d75
2029
1)
The licenses are held by Net4Mobility (a joint operation
\u00a0
with Tele 2, owned 50% by Telenor).
2)
Tele 2 and Telenor transferred their respective licences
\u00a0
(2\u00d720 MHz) in the 2600 MHz band to Net4Mobility
\u00a0
on 2 July 2012.
3)
Telenor transferred 2x10 MHz (out of 2x19.6 MHz) in the
\u00a0
2100 MHz band to Net4Mobility on 25 February 2022.
4)
The licenses are held by TT Netv\u00e6rket (a joint operation
\u00a0
with Telia, owned 50% by Telenor).
5)
The spectrum is held under capacity agreement with TOT
\u00a0
and therefore not part of right-of-use assets.
Telenor
\u00a0
Pakistan\u2019s
\u00a0
900 MHz
\u00a0
and 1800
\u00a0
MHz spectrum
\u00a0
licence
\u00a0
expired on
\u00a0
25 May 2019,
\u00a0
and the renewal
\u00a0
fee was
\u00a0
set to NOK
\u00a0
4.0 billion
\u00a0
(USD 449
million)
\u00a0
by the Pakistan
\u00a0
Telecommunication
\u00a0
Authority
\u00a0
(PTA) for
\u00a0
an extension
\u00a0
period of
\u00a0
15 years.
\u00a0
Telenor Pakistan
\u00a0
disagreed
\u00a0
with the
\u00a0
terms and
conditions for renewal, primarily on the price.
\u00a0
Telenor Pakistan is of the opinion that
\u00a0
the renewal price should have been NOK 2.5
\u00a0
billion (USD 291
million),
\u00a0
which was
\u00a0
the same
\u00a0
as for prior
\u00a0
renewals
\u00a0
for other
\u00a0
operators.
\u00a0
Accordingly,
\u00a0
Telenor Pakistan
\u00a0
challenged
\u00a0
the terms
\u00a0
and conditions
\u00a0
for
renewal of said licence in Islamabad High
\u00a0
Court. On 19 July 2021, the High
\u00a0
Court decided the case in Telenor\u2019s disfavor.
\u00a0
Telenor Pakistan appealed
the case
\u00a0
to the Supreme
\u00a0
Court on
\u00a0
31 August
\u00a0
2021. In
\u00a0
December
\u00a0
2021, Telenor
\u00a0
Pakistan
\u00a0
signed the
\u00a0
licence under
\u00a0
protest whilst
\u00a0
waiting
\u00a0
for the
Supreme Court\u2019s
\u00a0
hearing of the case. On 25 May
\u00a0
2022, the Supreme Court rejected the appeal. The
\u00a0
new spectrum price is considered a variable
lease payment that has become in-substance
\u00a0
fixed, and the right-of-use asset and lease
\u00a0
liability has been adjusted accordingly. Telenor Pakistan is
still waiting for the written Supreme Court decision
\u00a0
and will assess to file a review petition. Telenor
\u00a0
Pakistan has paid a total of NOK
\u00a0
2.8 billion (USD
314 million
\u00a0
excl. interest)
\u00a0
of the demanded
\u00a0
licence renewal
\u00a0
fees.
\u00a0
See note 18
\u00a0
for further
\u00a0
information
\u00a0
about impairment
\u00a0
of Pakistan
\u00a0
following
\u00a0
the
Supreme Court
\u00a0
ruling.
Lease expenses
Expenses
\u00a0
recognised
\u00a0
in the income
\u00a0
statement
\u00a0
related
\u00a0
to lease
\u00a0
contracts
\u00a0
are presented
\u00a0
below:
NOK in millions
Classification
\u00a0
in income statement
\u00a0
2022
2021
Depreciation of right-of-use assets
Depreciation
\u00a0
and amortisation
7 690
7 447
Interest expenses
\u00a0
on lease
\u00a0
liabilities
Financial
\u00a0
expenses (note
\u00a0
9)
1 058
1 053
Variable
\u00a0
lease expenses
\u00a0
not dependant
\u00a0
on index
\u00a0
or rate
Other operating
\u00a0
expenses
\u00a0
(note 6)
2 145
2 057
Variable
\u00a0
lease expenses
\u00a0
not dependant
\u00a0
on index
\u00a0
or rate
Cost of materials and traffic charges (note
\u00a0
4)
\u00a0
141
116
Expenses
\u00a0
relating
\u00a0
to short term
\u00a0
leases
Other operating
\u00a0
expenses
\u00a0
(note 6)
54
116
Expenses
\u00a0
relating
\u00a0
to low value
\u00a0
leases
Other operating
\u00a0
expenses
\u00a0
(note 6)
13
12
Total
11 103
10 801
Variable
\u00a0
lease expenses
\u00a0
of NOK 2.3
\u00a0
billion (NOK
\u00a0
2.2 billion
\u00a0
in 2021)
\u00a0
recognised
\u00a0
in other
\u00a0
operating
\u00a0
expenses include
\u00a0
NOK 1.7
\u00a0
billion (NOK
\u00a0
1.8 billion
\u00a0
in
2021) related
\u00a0
to spectrum
\u00a0
and NOK
\u00a0
0.4 billion
\u00a0
(NOK 0.3
\u00a0
billion in
\u00a0
2021) related
\u00a0
to other lease
\u00a0
contracts.
\u00a0
Variable
\u00a0
lease expenses
\u00a0
related
\u00a0
to spectrum
agreements vary mainly with revenue, as a significant
\u00a0
part of the expenses are based on
\u00a0
share of revenues under the agreements. Variable lease
expenses
\u00a0
related
\u00a0
to other lease
\u00a0
contracts
\u00a0
of NOK 0.4
\u00a0
billion
\u00a0
(0.3 billion
\u00a0
NOK in 2021)
\u00a0
represent
\u00a0
energy charges
\u00a0
paid to
\u00a0
lessors as
\u00a0
part of
\u00a0
the lease
agreements for some mobile sites, and the
\u00a0
expenses vary with the consumption of energy
\u00a0
on those mobile sites.
NOTE 15
Intangible assets
A significant part of intangible assets relates to software either acquired
\u00a0
individually, generated internally or
acquired in business combinations. Intangible assets
\u00a0
also include customer bases and trademarks in addition to
other intangible assets.
\u00a0
Accounting policies
\u00a0
Intangible
\u00a0
assets acquired
\u00a0
individually
\u00a0
are measured
\u00a0
initially
\u00a0
at cost and
\u00a0
recognised
\u00a0
as an intangible
\u00a0
assets when
\u00a0
the Group
\u00a0
has control
\u00a0
over the
asset, future
\u00a0
economic
\u00a0
benefits
\u00a0
are expected
\u00a0
to flow to
\u00a0
the Group
\u00a0
and the cost
\u00a0
can be measured
\u00a0
reliably.
\u00a0
The cost
\u00a0
to be capitalised
\u00a0
as part of
\u00a0
the
assets includes direct and incremental costs and,
\u00a0
for qualifying assets, borrowing costs. The cost
\u00a0
of intangible assets acquired in a business
combination
\u00a0
is the fair
\u00a0
value at
\u00a0
the date of
\u00a0
acquisition.
\u00a0
Following
\u00a0
that initial
\u00a0
recognition,
\u00a0
intangible
\u00a0
assets are
\u00a0
carried at
\u00a0
cost less
\u00a0
accumulated
amortisation and any impairment losses.
\u00a0
The straight-line
\u00a0
amortisation method is used for most intangible
\u00a0
assets as this best reflects the
consumption
\u00a0
of the assets.
\u00a0
The amortisation
\u00a0
period for
\u00a0
a customer
\u00a0
base is
\u00a0
the expected
\u00a0
lifetime
\u00a0
of the customer
\u00a0
relationship,
\u00a0
and the amortisation
method is
\u00a0
based on
\u00a0
historical
\u00a0
experience
\u00a0
of churn (customers
\u00a0
ending their
\u00a0
relationship)
\u00a0
for the different
\u00a0
businesses.
\u00a0
The useful
\u00a0
lives and
amortisation methods are reviewed at least annually.
\u00a0
Refer to note 18 for further information
\u00a0
about impairment.
Key judgments
\u00a0
and estimates
Amortisation expenses are based on management\u2019s estimates of
\u00a0
amortisation method, useful life and residual value.
\u00a0
Estimates may change due to
technological developments, changed competition or market conditions,
\u00a0
geopolitical developments and other factors. In particular,
\u00a0
technological
developments
\u00a0
are difficult
\u00a0
to predict
\u00a0
as trends
\u00a0
and pace
\u00a0
of development
\u00a0
may change
\u00a0
over time.
\u00a0
Estimated
\u00a0
useful lives
\u00a0
for similar
\u00a0
types of assets
may vary
\u00a0
between
\u00a0
different
\u00a0
entities due
\u00a0
to factors
\u00a0
such as growth
\u00a0
rate, maturity
\u00a0
of the market,
\u00a0
history and
\u00a0
expectations
\u00a0
for replacements
\u00a0
or
transfer of
\u00a0
assets, climate
\u00a0
and quality
\u00a0
of the technology
\u00a0
used. A change
\u00a0
in estimated
\u00a0
useful life
\u00a0
is a change
\u00a0
in accounting
\u00a0
estimate,
\u00a0
and
amortisation plans are adjusted prospectively. Refer to
\u00a0
note 18 for further information about impairment.
Intangible assets
NOK in millions
Customer
base
Trade-
marks
1)
Software
acquired
Internally
generated
software
Others
Work in
progress
2)
Total
As of 1 January 2021
2 560
6 372
19 762
4 253
2 097
1 894
36 938
Reclassifications
3)
-
-
1 386
700
( 423)
(2 053)
( 391)
Additions
-
-
1 111
-
99
1 379
2 589
Additions internally developed
-
-
-
219
8
-
227
Translation differences
( 114)
( 331)
( 518)
( 103)
( 92)
( 40)
(1 199)
Derecognition
( 77)
-
( 871)
( 392)
( 250)
( 1)
(1 592)
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
-
-
( 361)
-
-
-
( 361)
As of 31 December 2021
2 369
6 041
20 510
4 677
1 438
1 178
36 212
Reclassifications
3)
-
-
1 017
415
31
(1 448)
15
Additions
-
-
1 129
-
36
1 819
2 984
Additions internally developed
-
-
-
99
9
-
108
Translation differences
87
356
81
( 26)
( 21)
1
478
Derecognition
-
( 158)
(2 752)
( 153)
( 378)
( 275)
(3 716)
As of 31 December 2022
2 456
6 240
19 985
5 011
1 115
1 275
36 081
Accumulated amortisation and impairment
As of 1 January 2021
(1 064)
(3 086)
(16 309)
(3 552)
(1 703)
( 2)
(25 716)
Reclassifications
3)
-
-
-
( 40)
230
-
190
Amortisation - continuing operations
( 247)
-
(1 955)
( 504)
( 188)
-
(2 894)
Amortisation - discontinued operations
-
-
( 184)
-
-
-
( 184)
Impairment - discontinued operations
-
-
( 140)
-
-
-
( 140)
Translation differences
50
178
420
62
88
-
798
Derecognition
77
-
855
383
250
2
1 569
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
-
-
361
-
-
-
361
As of 31 December 2021
(1 184)
(2 907)
(16 954)
(3 651)
(1 323)
-
(26 018)
Reclassifications
3)
-
-
1
-
3
-
4
Amortisation - continuing operations
( 238)
-
(1 984)
( 604)
( 70)
-
(2 898)
Amortisation - discontinued operations
-
-
( 173)
-
-
-
( 173)
Impairment - continuing operations
-
-
( 29)
-
-
-
( 30)
Translation differences
( 40)
( 189)
( 17)
10
23
-
( 214)
Derecognition
-
147
2 273
138
378
-
2 936
As of 31 December 2022
(1 463)
(2 949)
(16 884)
(4 108)
( 990)
-
(26 392)
Carrying amount
As of 31 December 2022
993
3 291
3 101
904
125
1 275
9 689
As of 31 December 2021
1 185
3 134
3 556
1 026
115
1 178
10 195
Amortisation periods in years
3-20
-
3-7
3
3-5
-
-
1)
Trademarks have indefinite useful lives.
\u00a0
2)
The Additions line items represent net additions
\u00a0
of work in progress during the financial year. Work
\u00a0
in progress capitalised and activated within the
\u00a0
same
financial year is shown as Additions in the relevant
\u00a0
asset categories in this table.
3)
Including reclassifications to/from other lines in the statement
\u00a0
of financial position which are not a part of
\u00a0
this table.
NOTE 17
Property, plant and equipment
The majority of the property, plant and equipment (PPE) in Telenor relate
\u00a0
to investments in network equipment and
infrastructure, including base stations, cables, fiber
\u00a0
and radio equipment.
\u00a0
Other assets include equipment for
cable TV and satellites in addition to buildings, land and administrative
\u00a0
assets.
\u00a0
Accounting policies
Property, plant and equipment are recognised at
\u00a0
cost less accumulated depreciation and any impairment
\u00a0
losses.
\u00a0
The cost includes borrowing
costs for
\u00a0
qualifying
\u00a0
assets.
\u00a0
If Telenor
\u00a0
has a legal
\u00a0
or constructive
\u00a0
obligation
\u00a0
to dismantle,
\u00a0
remove
\u00a0
and restore
\u00a0
a site, an
\u00a0
asset retirement
\u00a0
obligation
(ARO) is recognized with a corresponding increase in the
\u00a0
related asset within property, plant and equipment.
\u00a0
AROs primarily relate to base stations
and installed network and infrastructure equipment in
\u00a0
addition to some buildings, refer to note
\u00a0
22 for further information. Estimated useful lives for
similar types of assets may vary between
\u00a0
different geographical areas due to factors such
\u00a0
as growth rate, maturity of the market,
\u00a0
history and
expectations for replacements or transfer of assets,
\u00a0
climate and quality of components used. Estimated useful
\u00a0
life, depreciation method and
residual
\u00a0
value are
\u00a0
evaluated
\u00a0
at least annually.
\u00a0
The straight-line
\u00a0
depreciation
\u00a0
method is
\u00a0
used as this
\u00a0
best reflects
\u00a0
the consumption
\u00a0
of the assets,
which often is the passage of time.
\u00a0
Residual value is estimated to be zero for
\u00a0
most assets, except for some commercial buildings
\u00a0
and vehicles that
are not expected to be used for
\u00a0
the whole economic life. Refer to note
\u00a0
18 for further information about impairment.
Key judgments
\u00a0
and estimates
Depreciation expenses are based on management\u2019s estimates of
\u00a0
depreciation method, useful life and residual value. Estimates
\u00a0
may change due to
technological developments, competition, changes in market conditions,
\u00a0
geopolitical developments, climate change and other factors.
\u00a0
In
particular, technological developments are difficult to predict
\u00a0
as trends and pace of development may
\u00a0
change over time. The asset retirement
obligation
\u00a0
(ARO) is a
\u00a0
significant
\u00a0
estimate as
\u00a0
there is
\u00a0
significant
\u00a0
uncertainty
\u00a0
related
\u00a0
to the timing
\u00a0
of the removal
\u00a0
and restoration
\u00a0
of the sites,
\u00a0
and also
whether the restoration actually will take place. There
\u00a0
is also significant uncertainty related to future
\u00a0
price development as the work will take
\u00a0
place
well into
\u00a0
the future.
\u00a0
See note
\u00a0
22 for further
\u00a0
information
\u00a0
about the
\u00a0
asset removal
\u00a0
obligation.
\u00a0
Climate changes
\u00a0
can potentially
\u00a0
lead to destruction
\u00a0
of
assets from flooding, fires or other natural
\u00a0
disasters. Climate changes and increased focus on
\u00a0
sustainable businesses may impact technological
development, markets and economic or legal environment which
\u00a0
are critical estimates in the evaluations of
\u00a0
useful lives. A change in estimated
useful life
\u00a0
is a change
\u00a0
in accounting
\u00a0
estimate,
\u00a0
and depreciation
\u00a0
plans are
\u00a0
adjusted
\u00a0
prospectively.
\u00a0
Refer to
\u00a0
note 18 for
\u00a0
further information
\u00a0
about
impairment.
Property, plant
\u00a0
and equipment
NOK in millions
Local,
and trunk
networks
Mobile
telephone
network
Subscribe
r
equipmen
t
Switches
and equip-
ment
Radio
installa-
tions
Cable-TV
equipmen
t
Buildings
Land
Corporate
adminis-
trative
assets
Satellites
Work in
progress
1)
Total
As of 1 January 2021
64 248
40 324
2 651
15 785
46 725
6 502
7 229
686
11 383
5 021
6 814
207 369
Reclassifications
2)
1 890
3 014
195
484
3 270
84
(560)
3
(106)
-
(7 839)
436
Additions
1 653
792
752
367
1 784
65
35
2
703
(14)
8 749
14 888
Translation differences
(1 187)
(1 685)
(65)
(403)
(1 920)
(59)
(127)
(28)
(381)
-
(223)
(6 079)
Derecognitions
(869)
(1 645)
(504)
(1 219)
(2 271)
(28)
(155)
(3)
(872)
-
(7)
(7 574)
Reclassified to assets held for
sale
(2 064)
(1 564)
(1)
(484)
(3 751)
(272)
(36)
-
(465)
-
(167)
(8 804)
As of 31
\u00a0
December
\u00a0
2021
63 671
39 236
3 028
14 530
43 837
6 293
6 386
660
10 262
5 007
7 326
200 235
Reclassifications
2)
1 321
2 496
(15)
283
2 294
34
(548)
(40)
702
-
(6 551)
(24)
Additions
1 842
547
582
361
2 438
48
90
18
771
-
7 093
13 789
Translation differences
542
109
(21)
(47)
397
(19)
30
7
(85)
-
39
953
Derecognitions
(5 420)
(8 952)
(837)
(3 027)
(10 574)
(371)
(464)
(67)
(1 945)
-
(408)
(32 064)
As of 31
\u00a0
December
\u00a0
2022
61 956
33 435
2 737
12 099
38 393
5 985
5 494
578
9 705
5 007
7 500
182 888
Accumulated depreciation and impairment losses
As of 1 January 2021
(40 166)
(23 439)
(1 431)
(13 642)
(28 912)
(4 252)
(4 797)
(4)
(7 913)
(3 442)
-
(128 001)
Reclassifications
2)
(402)
(448)
(9)
(2)
(397)
-
381
1
641
-
-
(236)
Depreciation - continuing
operations
(2 705)
(2 924)
(823)
(675)
(4 289)
(395)
(244)
-
(643)
(206)
-
(12 905)
Depreciation - discontinued
operations
(297)
(763)
-
(141)
(380)
-
(7)
-
(103)
-
-
(1 691)
Impairment - discontinued
operations
(641)
(817)
-
(43)
(1 488)
-
(15)
-
(215)
-
(176)
(3 395)
Translation differences
503
935
48
325
1 180
38
74
1
227
-
-
3 331
Derecognition
862
1 559
504
1 218
2 257
27
123
-
811
-
-
7 361
Reclassified to assets held for
sale
1 463
1 562
1
484
3 746
135
36
-
465
-
176
8 067
As of 31
\u00a0
December
\u00a0
2021
(41 383)
(24 335)
(1 711)
(12 475)
(28 283)
(4 447)
(4 451)
(2)
(6 733)
(3 648)
-
(127 468)
Reclassifications
2)
(119)
(583)
91
34
39
-
541
-
2
-
-
4
Depreciation - continuing
operations
(2 565)
(2 724)
(862)
(674)
(4 353)
(309)
(210)
-
(780)
(202)
-
(12 681)
Depreciation - discontinued
operations
(243)
(573)
-
(120)
(225)
-
(6)
-
(65)
-
-
(1 231)
Impairment - continuing
operations
(179)
(606)
-
(103)
(399)
-
(108)
(38)
(77)
-
-
(1 509)
Translation differences
(78)
123
15
67
(145)
14
(17)
3
129
-
-
110
Derecognition
4 234
6 259
836
2 657
9 235
369
195
-
1 762
-
-
25 546
As of 31
\u00a0
December
\u00a0
2022
(40 332)
(22 440)
(1 631)
(10 615)
(24 132)
(4 373)
(4 056)
(38)
(5 762)
(3 850)
-
(117 229)
As of 31
\u00a0
December
\u00a0
2022
21 623
10 995
1 106
1 485
14 260
1 612
1 438
540
3 943
1 157
7 500
65 659
As of 31
\u00a0
December
\u00a0
2021
22 287
14 901
1 317
2 055
15 554
1 846
1 935
658
3 529
1 359
7 326
72 767
Depreciation periods, years
3)
3-30
5-20
3
3-7
5-15
3-15
5-30
-
2-10
17
-
-
1)
The Additions line items represent net additions
\u00a0
of work in progress during the financial year. Work
\u00a0
in progress capitalised and activated within
\u00a0
the same
financial year is shown as Additions in the relevant
\u00a0
asset categories in this table.
2)
Including reclassifications to/from other lines in the statement
\u00a0
of financial position which is not a part of this
\u00a0
table.
3)
Asset categories presented in this movement schedule
\u00a0
is an aggregated total from different asset components
\u00a0
belonging to a particular category, and the
disclosed depreciation rates represent a range of useful
\u00a0
lives allocated to components.
Accounting policies
Property, plant and equipment are recognised at
\u00a0
cost less accumulated depreciation and any impairment
\u00a0
losses.
\u00a0
The cost includes borrowing
costs for
\u00a0
qualifying
\u00a0
assets.
\u00a0
If Telenor
\u00a0
has a legal
\u00a0
or constructive
\u00a0
obligation
\u00a0
to dismantle,
\u00a0
remove
\u00a0
and restore
\u00a0
a site, an
\u00a0
asset retirement
\u00a0
obligation
(ARO) is recognized with a corresponding increase in the
\u00a0
related asset within property, plant and equipment.
\u00a0
AROs primarily relate to base stations
and installed network and infrastructure equipment in
\u00a0
addition to some buildings, refer to note
\u00a0
22 for further information. Estimated useful lives for
similar types of assets may vary between
\u00a0
different geographical areas due to factors such
\u00a0
as growth rate, maturity of the market,
\u00a0
history and
expectations for replacements or transfer of assets,
\u00a0
climate and quality of components used. Estimated useful
\u00a0
life, depreciation method and
residual
\u00a0
value are
\u00a0
evaluated
\u00a0
at least annually.
\u00a0
The straight-line
\u00a0
depreciation
\u00a0
method is
\u00a0
used as this
\u00a0
best reflects
\u00a0
the consumption
\u00a0
of the assets,
which often is the passage of time.
\u00a0
Residual value is estimated to be zero for
\u00a0
most assets, except for some commercial buildings
\u00a0
and vehicles that
are not expected to be used for
\u00a0
the whole economic life. Refer to note
\u00a0
18 for further information about impairment.
Accounting policies
Property, plant and equipment are recognised at
\u00a0
cost less accumulated depreciation and any impairment
\u00a0
losses.
\u00a0
The cost includes borrowing
costs for
\u00a0
qualifying
\u00a0
assets.
\u00a0
If Telenor
\u00a0
has a legal
\u00a0
or constructive
\u00a0
obligation
\u00a0
to dismantle,
\u00a0
remove
\u00a0
and restore
\u00a0
a site, an
\u00a0
asset retirement
\u00a0
obligation
(ARO) is recognized with a corresponding increase in the
\u00a0
related asset within property, plant and equipment.
\u00a0
AROs primarily relate to base stations
and installed network and infrastructure equipment in
\u00a0
addition to some buildings, refer to note
\u00a0
22 for further information. Estimated useful lives for
similar types of assets may vary between
\u00a0
different geographical areas due to factors such
\u00a0
as growth rate, maturity of the market,
\u00a0
history and
expectations for replacements or transfer of assets,
\u00a0
climate and quality of components used. Estimated useful
\u00a0
life, depreciation method and
residual
\u00a0
value are
\u00a0
evaluated
\u00a0
at least annually.
\u00a0
The straight-line
\u00a0
depreciation
\u00a0
method is
\u00a0
used as this
\u00a0
best reflects
\u00a0
the consumption
\u00a0
of the assets,
which often is the passage of time.
\u00a0
Residual value is estimated to be zero for
\u00a0
most assets, except for some commercial buildings
\u00a0
and vehicles that
are not expected to be used for
\u00a0
the whole economic life. Refer to note
\u00a0
18 for further information about impairment.
.
NOTE 18
Impairment of assets
Telenor has significant investments in the network and infrastructure
\u00a0
required to operate in the telecom industry,
such as base stations, networks and radio equipment.
\u00a0
Other significant assets include goodwill, customer bases
and software. Goodwill is tested for impairment annually or
\u00a0
when impairment indicators
\u00a0
are present.
\u00a0
In 2022,
Telenor has recognised impairment of NOK 2.5 billion related
\u00a0
to its operations in Pakistan following the adverse
ruling of Supreme Court in the licence renewal case.
\u00a0
Accounting policies
Impairment indicators are assessed at each reporting
\u00a0
date for individual assets and cash generating units
\u00a0
(CGUs),
\u00a0
and impairment testing is
performed if any indicators are identified. Goodwill, intangible
\u00a0
assets with indefinite useful life and intangible assets
\u00a0
not yet brought into use are
assessed for impairment annually or when impairment indicators
\u00a0
are identified. Identification of Telenor\u2019s main CGUs is
\u00a0
based on the countries
where Telenor operates its fixed and mobile
\u00a0
operations. The CGU may include both fixed and mobile
\u00a0
operations as they are monitored and
reported as one operating unit.
\u00a0
Goodwill arising from acquisitions are allocated to the
\u00a0
respective CGU and included in the impairment
\u00a0
test. Fair
values are
\u00a0
used in the
\u00a0
CGU testing
\u00a0
when these
\u00a0
are available,
\u00a0
for example
\u00a0
when the
\u00a0
CGU is a listed
\u00a0
company.
\u00a0
In assessing
\u00a0
value-in-use,
\u00a0
the
estimated
\u00a0
future cash
\u00a0
flows are
\u00a0
discounted
\u00a0
to their
\u00a0
present value
\u00a0
using a
\u00a0
discount rate
\u00a0
based on
\u00a0
the weighted
\u00a0
average cost
\u00a0
of capital
\u00a0
(WACC) rate.
The WACC
\u00a0
reflects
\u00a0
current market
\u00a0
assessments
\u00a0
of the time
\u00a0
value of
\u00a0
money and
\u00a0
the risks
\u00a0
specific
\u00a0
to the asset
\u00a0
or the CGU
\u00a0
to which
\u00a0
the asset
belongs. Impairments are recognised by reducing carrying
\u00a0
amount of goodwill first before other assets
\u00a0
are reduced on a pro-rata basis.
Impairments
\u00a0
of goodwill
\u00a0
are not reversed.
Key judgments
\u00a0
and estimates
Significant management judgment is used when assessing
\u00a0
impairment triggers at each reporting date. The
\u00a0
following factors are assessed:
significant
\u00a0
fall in market
\u00a0
values; significant
\u00a0
underperformance
\u00a0
relative
\u00a0
to historical
\u00a0
or projected
\u00a0
future operating
\u00a0
results;
\u00a0
significant
\u00a0
changes in
\u00a0
the
use of the
\u00a0
assets or
\u00a0
the strategy
\u00a0
for the overall
\u00a0
business,
\u00a0
including
\u00a0
assets that
\u00a0
are decided
\u00a0
to be phased
\u00a0
out or replaced
\u00a0
and assets that
\u00a0
are
damaged or taken out of use; significant
\u00a0
negative industry or economic trends; significant loss of
\u00a0
market share; significant adverse political and/or
regulatory development including unfavourable court decisions and significant
\u00a0
cost overruns in the development of assets.
The assessment of value-in-use
\u00a0
includes significant management judgments and estimates, including determining
\u00a0
the discount rate (WACC),
estimating future performance, revenue generating capacity of
\u00a0
the assets, margins, prices on future renewals
\u00a0
of spectrum licences, political and
regulatory risk, required maintenance capex, network costs
\u00a0
and technological developments, and assumptions of the
\u00a0
future market conditions.
There are significant variations between different markets
\u00a0
with respect to growth, mobile penetration,
\u00a0
average revenue per user (ARPU),
\u00a0
market
share, inflation, regulatory costs, and technological development,
\u00a0
resulting in differences in EBITDA margins, future investments,
\u00a0
and long terms
growth assumptions. In some markets, certain expenses
\u00a0
and capex are denominated in foreign currency and
\u00a0
impacted by currency fluctuations.
Recessionary effects and increased macroeconomic risks may
\u00a0
impact the estimates of growth, future performance
\u00a0
and discount rates used in
estimating recoverable amounts of assets. Discount
\u00a0
rates are impacted by several macroeconomic factors
\u00a0
including borrowing rates, country risk,
inflation assumptions and currency development. For assumptions
\u00a0
used, external evidence has been taken into consideration.
Climate-related
\u00a0
risks
Telenor is exposed to climate-related
\u00a0
physical risks such as potential damage to
\u00a0
infrastructure and utilities through the impact of
\u00a0
more extreme
weather events
\u00a0
and rising
\u00a0
sea levels.
\u00a0
Climate-related
\u00a0
regulatory
\u00a0
risks include
\u00a0
potentially
\u00a0
higher operational
\u00a0
costs due
\u00a0
to increasing
\u00a0
carbon taxes
and energy/fuel
\u00a0
taxes, as
\u00a0
well as
\u00a0
risks of higher
\u00a0
capital expenditures
\u00a0
due to a
\u00a0
required
\u00a0
transition
\u00a0
towards the
\u00a0
use of renewable
\u00a0
energy solutions
\u00a0
and
energy efficient
\u00a0
networks.
\u00a0
Climate-related
\u00a0
risks are
\u00a0
considered
\u00a0
in the cash
\u00a0
flow projections.
\u00a0
Cash flows
Discounted
\u00a0
cash flow
\u00a0
models have
\u00a0
been applied
\u00a0
to determine
\u00a0
the value-in-use
\u00a0
for cash-generating
\u00a0
units.
\u00a0
The cash
\u00a0
flows are
\u00a0
based on the
\u00a0
most
recent financial forecasts approved by management. Management has
\u00a0
projected cash flows based on financial forecasts and
\u00a0
strategy plans
covering the period 2023-2025
\u00a0
for DNA and Telenor Pakistan.
\u00a0
The cash flows beyond the explicit forecast
\u00a0
period have been extrapolated into
perpetuity
\u00a0
using a
\u00a0
constant nominal
\u00a0
growth rate
\u00a0
to arrive
\u00a0
at the terminal
\u00a0
value. The
\u00a0
estimates
\u00a0
of value
\u00a0
in use have
\u00a0
been compared
\u00a0
to market
valuation
\u00a0
and multiples
\u00a0
for peers
\u00a0
in the telecommunication
\u00a0
business
\u00a0
for reasonableness.
\u00a0
The expected growth in revenue, EBITDA, and
\u00a0
EBITDA margin for a cash-generating unit
\u00a0
is based on historical performance, expected
development in the market in which the entity
\u00a0
operates and assumptions in terms of development
\u00a0
in market share. The growth rates applied
\u00a0
in the
explicit forecast period converge from its current level
\u00a0
experienced over the last few years to the
\u00a0
long-term growth level in the market where
\u00a0
the
entity operates. The growth rates used to
\u00a0
extrapolate cash flow projections beyond the explicit forecast
\u00a0
period are not higher than the average
expected long-term growth in the markets in which
\u00a0
the entities operate. In periods with relatively
\u00a0
low discount rates, the estimated growth rates
used in the projections might be determined
\u00a0
significantly below the average expected long term growth observed
\u00a0
in the market.
Average revenue per user (ARPU)
\u00a0
ARPU is a measure for average revenue
\u00a0
per subscription per month, which is a key
\u00a0
component when estimating revenue growth. ARPU is
calculated based on mobile revenues from the
\u00a0
company\u2019s own subscriptions, divided by the average number
\u00a0
of subscriptions for the relevant
period. ARPU is estimated based on the current
\u00a0
ARPU level and expected
\u00a0
future market development.
EBITDA margin
1)
The EBITDA margin is estimated based on the
\u00a0
current margin level and expected future market development.
\u00a0
Committed or implemented
operational efficiency programmes are included. Changes in
\u00a0
the outcome of these initiatives may affect
\u00a0
future estimated EBITDA margins.
\u00a0
Capital expenses
\u00a0
(capex)
1)
\u00a0
and spectrum licences
\u00a0
A normalised level of capex as a percentage
\u00a0
of revenues (capex/revenues) is assumed in the
\u00a0
long run. Changes in traffic volumes and
\u00a0
number of
subscriptions during a growth phase
\u00a0
will affect the future capex/revenues
\u00a0
ratio. Estimated capex reflect the level of
\u00a0
capex needed for maintaining
current operation.
\u00a0
Costs related
\u00a0
to future spectrum
\u00a0
acquisitions
\u00a0
are estimated
\u00a0
based on
\u00a0
historical
\u00a0
levels of
\u00a0
spectrum costs
\u00a0
compared
\u00a0
to revenue
Included in the assessment of future spectrum
\u00a0
prices.
\u00a0
Telenor also takes into consideration the development in
\u00a0
neighbouring countries
\u00a0
and more
advanced markets for potential spectrum auctions in
\u00a0
emerging markets.
\u00a0
Discount rates are based on Weighted Average
\u00a0
Cost of Capital (WACC) derived from the Capital
\u00a0
Asset Pricing Model (CAPM) methodology. The
cost is derived from its weighted average cost
\u00a0
of capital. In economies where the Group
\u00a0
considers risk-free yields to be
\u00a0
unreliable, the WACC rates
used in discounting the future cash flows
\u00a0
are based on a US 30-year risk-free
\u00a0
interest rate, adjusted with a country risk
\u00a0
premium and the inflation
differential between the US and the relevant
\u00a0
country. The discount rates consider the debt
\u00a0
premium, market risk premium, gearing, corporate tax
rate, inflation, and asset beta. For cash-generating
\u00a0
units in economies with unstable inflation rates,
\u00a0
rolling discount rates are applied.
\u00a0
1)
Please refer to page 180 for description of alternative
\u00a0
performance measures.
\u00a0
Cash-generating
\u00a0
units (CGUs)
\u00a0
with significant
\u00a0
goodwill
The goodwill
\u00a0
allocated
\u00a0
to each CGU
\u00a0
is shown in
\u00a0
note 14.
\u00a0
The recoverable
\u00a0
amounts for
\u00a0
the cash-generating
\u00a0
units with
\u00a0
significant
\u00a0
goodwill
\u00a0
have been
determined based on the following discount rates
\u00a0
and terminal value nominal growth rates for
\u00a0
the years 2022 and 2021:
Discount
\u00a0
rate after tax
\u00a0
(%)
Discount
\u00a0
rate pre-tax
\u00a0
(%)
Nominal growth
\u00a0
in cash flow
\u00a0
in terminal
\u00a0
value (%)
2022
2021
2022
2021
2022
2021
Telenor Sweden
6.7
5.0
8.5
6.4
1.9
0.0
DNA
6.8
5.0
8.5
6.3
2.3
0.75
In the recoverable
\u00a0
amount assessment,
\u00a0
the Group
\u00a0
has applied
\u00a0
estimated
\u00a0
cash flows
\u00a0
after tax
\u00a0
and corresponding
\u00a0
discount rates
\u00a0
after tax.
\u00a0
The
recoverable amounts would not change significantly if
\u00a0
pre-tax cash flows and pre-tax discount rates
\u00a0
had been applied instead.
\u00a0
The war
\u00a0
in Ukraine
\u00a0
has generated
\u00a0
a sharp increase
\u00a0
in energy
\u00a0
prices following
\u00a0
the shortage
\u00a0
of supply,
\u00a0
and there
\u00a0
is increased
\u00a0
risk of supply
\u00a0
chain
disruption due to escalating trade tension and sanctions.
\u00a0
The risk related to continued high energy prices
\u00a0
and general inflation caused by the war is
reflected
\u00a0
in the forecasts
\u00a0
used as
\u00a0
basis for
\u00a0
the value
\u00a0
in use calculation.
,
Impairment
\u00a0
in 2022 and 2021
In 2022,
\u00a0
Telenor recognised
\u00a0
an impairment
\u00a0
of assets
\u00a0
of NOK 2.5
\u00a0
billion related
\u00a0
to Telenor
\u00a0
Pakistan
\u00a0
as a result
\u00a0
of several
\u00a0
negative developments.
\u00a0
A
significant increase in interest rates, country risk premium
\u00a0
and market premiums impacted the Weighted Average
\u00a0
Cost of Capital. A hike in energy
prices and increased global inflation made the
\u00a0
outlook for Telenor Pakistan challenging. Further, one of
\u00a0
the key assumptions in the assessment at
year end 2021 was the outcome of
\u00a0
the Supreme Court\u2019s hearing related to the
\u00a0
renewal fee for the 900 MHz and 1800 MHz
\u00a0
spectrum license. On 25
May 2022, the Supreme Court concluded the
\u00a0
fee to remain at the level set
\u00a0
by the Pakistani Telecommunication Authority, see note 23.
\u00a0
In June 2022
Telenor completed an assessment of value in use
\u00a0
based on discounted cash flows of Telenor
\u00a0
Pakistan with updated earnings projections. As a
consequence,
\u00a0
an impairment
\u00a0
of NOK 2.5
\u00a0
billion was
\u00a0
recognised
\u00a0
in the second
\u00a0
quarter 2022
\u00a0
related to
\u00a0
property,
\u00a0
plant and
\u00a0
equipment,
\u00a0
right-of-use
assets and intangible
\u00a0
assets in the Telenor Pakistan segment. Recoverable
\u00a0
amount of the assets was estimated to
\u00a0
be NOK 5.8 billion as of 30 June
2022. The impairment assessment, with several scenarios, was
\u00a0
updated as of year-end 2022 and no
\u00a0
further impairment was recognised. Telenor
Pakistan
\u00a0
is still
\u00a0
sensitive
\u00a0
for impairment.
\u00a0
The impairment
\u00a0
per class
\u00a0
of asset was
\u00a0
as follows:
NOK in million
2022
Property, plant and equipment
1 508
963
29
Total impairments
2 500
Key assumptions
\u00a0
applied
\u00a0
in the calculation
\u00a0
of value in
\u00a0
use for Telenor
\u00a0
Pakistan
\u00a0
as of 30 June
\u00a0
2022 are stated
\u00a0
in the table
\u00a0
below. During
\u00a0
the
assessment of Telenor Pakistan, several scenarios related
\u00a0
to timing and level of spectrum acquisitions, investment in
\u00a0
radio equipment and
operational efficiency were prepared. The assessment was
\u00a0
based on a weighting of scenarios reflecting
\u00a0
the mentioned sensitivities. The weighted
key assumptions
\u00a0
used in the
\u00a0
scenarios
\u00a0
are summarised
\u00a0
below.
Key assumptions
\u00a0
2022
Telenor Pakistan
Revenue growth during 2022-2027, percent
1
1.1
EBITDA growth during 2022-2027, percent
1
1.7
EBITDA margin growth from 2022-2027, percentage points
2
1.7
Capex/revenues in the terminal value, percent
13.5
WACC, percent
WACC used
\u00a0
in the testing
\u00a0
at year-end
\u00a0
2021, percent
Nominal growth in cash flow in terminal
\u00a0
value, percent
4.8
1)
Represents the compound annual growth rate during
\u00a0
the period.
\u00a0
2)
Represents annual growth during the period.
Telenor did not recognise any significant impairments
\u00a0
in 2021,
\u00a0
except for the impairment recognised
\u00a0
for Telenor Myanmar presented as
discontinued
\u00a0
operations,
\u00a0
see note
\u00a0
12.
Sensitive
\u00a0
cash-generating
\u00a0
units with significant
\u00a0
goodwill
Apart from DNA in Finland, the Group
\u00a0
believes that no reasonably possible change in any
\u00a0
of the key assumptions used for impairment testing
\u00a0
would
cause the
\u00a0
carrying
\u00a0
amounts of
\u00a0
the cash-generating
\u00a0
units with
\u00a0
significant
\u00a0
goodwill
\u00a0
to exceed
\u00a0
recoverable
\u00a0
amounts. The
\u00a0
recoverable
\u00a0
amount of DNA
has been estimated based on
\u00a0
discounted cash flows from current revenue streams and
\u00a0
the estimated recoverable amount exceeds the carrying
amount
\u00a0
by approximately NOK 9.5 billion. Key assumptions
\u00a0
used to determine recoverable amount of DNA
\u00a0
are listed in the table below:
Key assumptions
\u00a0
in 2022
DNA
Revenue growth during 2023-2025, per cent
1)
2.9
Revenue growth
\u00a0
in the year
\u00a0
used as basis
\u00a0
for calculation
\u00a0
of terminal
\u00a0
value ,
\u00a0
per cent
\u00a0
2.0
EBITDA growth during 2023-2025, per cent
1)
4.7
EBITDA margin growth from 2023 to 2025, percentage points
2)
0.6
EBITDA margin
\u00a0
in the year
\u00a0
used as basis
\u00a0
for calculation
\u00a0
of terminal
\u00a0
value, per
\u00a0
cent
37.0
Nominal growth in cash flow in terminal
\u00a0
value, per cent
2.3
Capex/revenues
\u00a0
in the terminal
\u00a0
value, per
\u00a0
cent
13.5
6.8
1)
Represents the compound annual growth rate during
\u00a0
the period.
\u00a0
2)
Represents annual growth during the period.
The Finnish
\u00a0
market has
\u00a0
historically
\u00a0
seen a relatively
\u00a0
high growth
\u00a0
in subscription
\u00a0
and traffic
\u00a0
revenues.
\u00a0
The expected
\u00a0
growth in
\u00a0
revenue and
\u00a0
EBITDA
for DNA reflects
\u00a0
expectations
\u00a0
of continued
\u00a0
upselling
\u00a0
of existing
\u00a0
customers following
\u00a0
the 5G rollout,
\u00a0
increased
\u00a0
market share
\u00a0
within the
\u00a0
business
segment and higher contribution from value added
\u00a0
services, supported by DNA\u2019s historical performance and
\u00a0
external sources of information. Real
GDP growth
\u00a0
in the Finnish
\u00a0
economy
\u00a0
is expected
\u00a0
to be between
\u00a0
1.5-2.0 %
\u00a0
per year
\u00a0
in the medium
\u00a0
to long-term
\u00a0
period, and
\u00a0
inflation
\u00a0
is expected
\u00a0
to be
at comparable level. Capex/revenues in terminal value represent
\u00a0
normal investment level after 5G roll-out
\u00a0
and is in line with historical levels
(excluding spectrum). Spectrum prices are assumed to
\u00a0
be in line with historical levels.
\u00a0
The following changes in key assumptions, in isolation,
\u00a0
would result in the recoverable amount being
\u00a0
approximately equal to the carrying amount.
Consequential
\u00a0
effects of
\u00a0
a change
\u00a0
in one key
\u00a0
assumption
\u00a0
on other
\u00a0
key assumptions
\u00a0
may occur.
\u00a0
Predicting
\u00a0
any interaction
\u00a0
between
\u00a0
them involves
significant
\u00a0
uncertainties
\u00a0
and judgements,
\u00a0
and thus
\u00a0
has not been
\u00a0
done. Changes
\u00a0
beyond those
\u00a0
described
\u00a0
below may
\u00a0
lead to impairment.
DNA
Decrease in annual revenue growth during 2023-2025
\u00a0
by 1.4 percentage points
Decerease
\u00a0
in revenue
\u00a0
growth in
\u00a0
the year
\u00a0
used as basis
\u00a0
for calculation
\u00a0
of terminal
\u00a0
value by
\u00a0
4.3 percentage
\u00a0
points
Decrease in annual EBITDA growth during 2023-2025 by
\u00a0
2.8 percentage points
Decrease in annual EBITDA margin growth from
\u00a0
2023 to 2025 by 1.3 percentage points
Decrease in EBITDA margin in the year used
\u00a0
as basis for calculation of terminal value by
\u00a0
4.2 percentage points
Increase
\u00a0
in WACC
\u00a0
by 1 percentage
\u00a0
points
Decrease
\u00a0
in nominal
\u00a0
growth in
\u00a0
cash flow
\u00a0
in terminal
\u00a0
value by
\u00a0
1.1 percentage
\u00a0
points
Increase in capex/revenues in the terminal value
\u00a0
by 3.4 percentage points
.
Accounting policies
Impairment indicators are assessed at each reporting
\u00a0
date for individual assets and cash generating units
\u00a0
(CGUs),
\u00a0
and impairment testing is
performed if any indicators are identified. Goodwill, intangible
\u00a0
assets with indefinite useful life and intangible assets
\u00a0
not yet brought into use are
assessed for impairment annually or when impairment indicators
\u00a0
are identified. Identification of Telenor\u2019s main CGUs is
\u00a0
based on the countries
where Telenor operates its fixed and mobile
\u00a0
operations. The CGU may include both fixed and mobile
\u00a0
operations as they are monitored and
reported as one operating unit.
\u00a0
Goodwill arising from acquisitions are allocated to the
\u00a0
respective CGU and included in the impairment
\u00a0
test. Fair
values are
\u00a0
used in the
\u00a0
CGU testing
\u00a0
when these
\u00a0
are available,
\u00a0
for example
\u00a0
when the
\u00a0
CGU is a listed
\u00a0
company.
\u00a0
In assessing
\u00a0
value-in-use,
\u00a0
the
estimated
\u00a0
future cash
\u00a0
flows are
\u00a0
discounted
\u00a0
to their
\u00a0
present value
\u00a0
using a
\u00a0
discount rate
\u00a0
based on
\u00a0
the weighted
\u00a0
average cost
\u00a0
of capital
\u00a0
(WACC) rate.
The WACC
\u00a0
reflects
\u00a0
current market
\u00a0
assessments
\u00a0
of the time
\u00a0
value of
\u00a0
money and
\u00a0
the risks
\u00a0
specific
\u00a0
to the asset
\u00a0
or the CGU
\u00a0
to which
\u00a0
the asset
belongs. Impairments are recognised by reducing carrying
\u00a0
amount of goodwill first before other assets
\u00a0
are reduced on a pro-rata basis.
Impairments
\u00a0
of goodwill
\u00a0
are not reversed.
Accounting policies
Impairment indicators are assessed at each reporting
\u00a0
date for individual assets and cash generating units
\u00a0
(CGUs),
\u00a0
and impairment testing is
performed if any indicators are identified. Goodwill, intangible
\u00a0
assets with indefinite useful life and intangible assets
\u00a0
not yet brought into use are
assessed for impairment annually or when impairment indicators
\u00a0
are identified. Identification of Telenor\u2019s main CGUs is
\u00a0
based on the countries
where Telenor operates its fixed and mobile
\u00a0
operations. The CGU may include both fixed and mobile
\u00a0
operations as they are monitored and
reported as one operating unit.
\u00a0
Goodwill arising from acquisitions are allocated to the
\u00a0
respective CGU and included in the impairment
\u00a0
test. Fair
values are
\u00a0
used in the
\u00a0
CGU testing
\u00a0
when these
\u00a0
are available,
\u00a0
for example
\u00a0
when the
\u00a0
CGU is a listed
\u00a0
company.
\u00a0
In assessing
\u00a0
value-in-use,
\u00a0
the
estimated
\u00a0
future cash
\u00a0
flows are
\u00a0
discounted
\u00a0
to their
\u00a0
present value
\u00a0
using a
\u00a0
discount rate
\u00a0
based on
\u00a0
the weighted
\u00a0
average cost
\u00a0
of capital
\u00a0
(WACC) rate.
The WACC
\u00a0
reflects
\u00a0
current market
\u00a0
assessments
\u00a0
of the time
\u00a0
value of
\u00a0
money and
\u00a0
the risks
\u00a0
specific
\u00a0
to the asset
\u00a0
or the CGU
\u00a0
to which
\u00a0
the asset
belongs. Impairments are recognised by reducing carrying
\u00a0
amount of goodwill first before other assets
\u00a0
are reduced on a pro-rata basis.
Impairments
\u00a0
of goodwill
\u00a0
are not reversed.
NOTE 19
Trade and other receivables
Accounting policies
Trade and other receivables are recognised at fair value including
\u00a0
directly attributable transaction costs and subsequently measured at
amortised cost using the effective interest rate method. A customer
\u00a0
contract asset is recognised when the revenue from contracts with
customers exceeds the amounts received,
\u00a0
for example when sale of handsets
\u00a0
or other customer equipment is recovered through future
subscription fee payments. Contract assets are transferred to trade receivables
\u00a0
when the rights to payment become unconditional, which
is normally when the invoice has been issued. Refer
\u00a0
to further information in note 3 Revenues.
Key judgments
\u00a0
and estimates
Trade receivables and contract assets are adjusted
\u00a0
for provision for impairment in accordance with
\u00a0
the expected credit loss model. The simplified
approach
\u00a0
is applied
\u00a0
measuring
\u00a0
the loss allowance
\u00a0
at an amount
\u00a0
equal to
\u00a0
lifetime
\u00a0
expected
\u00a0
credit losses.
\u00a0
Impairment
\u00a0
for expected
\u00a0
credit losses
\u00a0
is
assessed every reporting period and calculated by considering
\u00a0
the historic evidence of the level of
\u00a0
bad debt experienced for customer types and
the aging of the receivable balance.
Trade and other
\u00a0
receivables
NOK in millions
Category
2022
2021
Receivables
\u00a0
from contracts
\u00a0
with customers
15 245
15 490
Provision for expected credit losses on trade receivables
(894)
(998)
Total receivables from contracts with customers as of
\u00a0
31 December
FAAC
1)
14 352
14 492
Interest-bearing receivables
3)
35
1 051
Finance lease receivable
4)
458
423
Other non-interest-bearing
\u00a0
receivables
1 648
2 334
Provision for expected credit losses on other current
\u00a0
receivables
(13)
(15)
Total other current receivables as of 31 December
FAAC
1)
2 128
3 793
Contract asset
216
362
5)
85
71
Governmental taxes and duties
388
685
1 674
2 336
Total other current non-financial assets as of 31 December
NF
2)
2 362
3 455
Total trade and other receivables as of 31 December
18 842
21 739
1)
FAAC: Financial assets at amortised cost
2)
NF: Non-financial assets and liabilities
3)
In 2021, this includes the current portion of the deferred
\u00a0
sales consideration receivable from PPF Group for
\u00a0
the sale of shares in Telenor Serbia in 2018.
\u00a0
4)
See note 27 for more information
5)
Asset for the right to recover returned goods on settling
\u00a0
refund liabilities.
As of 31
\u00a0
December
\u00a0
2022, NOK
\u00a0
3.1 billion
\u00a0
(NOK 3.1
\u00a0
billion as
\u00a0
of 31 December
\u00a0
2021) of
\u00a0
trade and
\u00a0
other receivables
\u00a0
relates to
\u00a0
handset instalments
\u00a0
not
due within
\u00a0
one year.
Specification
\u00a0
of contract assets
NOK in millions
2022
2021
Balance as of 1 January
362
412
New contract assets during the period less
\u00a0
transfer to receivables
93
( 41)
Disposal
\u00a0
of subsidiaries
( 263)
-
Currency
\u00a0
and other
\u00a0
effects
24
( 9)
Balance as of 31 December
216
362
Specification
\u00a0
of provision for
\u00a0
expected credit
\u00a0
losses on trade
\u00a0
receivables
NOK in millions
2022
2021
Provision as of 1 January
( 998)
(1 268)
Change during the year - continuing operations
( 91)
111
Change during the year - discontinued operations
77
55
Disposal
\u00a0
of subsidiaries
131
-
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
-
49
Currency
\u00a0
and other
\u00a0
effects
( 13)
55
Provision as of 31 December
( 894)
( 998)
Realised losses for the year - continuing
\u00a0
operations
( 549)
( 629)
Realised losses for the year - discontinued
\u00a0
operations
( 137)
( 203)
Recovered amounts previously provided for - continuing operations
37
39
Recovered amounts previously provided for - discontinued operations
45
46
Specification
\u00a0
of the age distribution
\u00a0
of trade receivables
Past due on
\u00a0
the reporting
\u00a0
date in the
\u00a0
following periods:
NOK in millions
Carrying
amount
reporting date
60 days
90 days
180 days
365 days
More than
365 days
As of 31 December 2022
Trade receivables
15 245
12 567
1 077
263
135
324
347
532
Provision for expected
credit losses
\u00a0
on trade
receivables
( 894)
( 65)
( 42)
( 34)
( 45)
( 129)
( 218)
( 360)
Total trade receivables
14 352
12 502
1 035
229
89
194
130
172
As of 31 December 2021
Trade receivables
15 490
12 825
990
239
137
277
399
621
Provision for expected
credit losses
\u00a0
on trade
receivables
( 998)
( 101)
( 43)
( 45)
( 51)
( 135)
( 229)
( 394)
Total trade receivables
14 492
12 724
947
194
86
142
171
227
For the trade
\u00a0
and other
\u00a0
current receivables
\u00a0
that are
\u00a0
not impaired
\u00a0
or past due,
\u00a0
there are
\u00a0
no indicators
\u00a0
at the date
\u00a0
of the reporting
\u00a0
that the debtors
will not
\u00a0
be able
\u00a0
to meet their
\u00a0
payment obligations.
NOTE 27
Financial assets and non-interest-bearing liabilities
Derivatives such as forward currency contracts and interest rate swaps
\u00a0
are used to mitigate financial risks. Other
financial assets include commercial papers, deposits, lease receivables
\u00a0
and equity investments.
\u00a0
Accounting policies
Financial
\u00a0
assets and
\u00a0
liabilities
A financial instrument is defined as any
\u00a0
contract that gives rise to a financial
\u00a0
asset of one entity and a financial liability or
\u00a0
equity instrument of
another entity. The financial instruments are recognised in
\u00a0
the statement of financial position when Telenor becomes
\u00a0
a party to the contractual
provisions of the instrument, using trade date
\u00a0
accounting. Financial assets and liabilities are offset
\u00a0
when there is intention and legally enforceable
right to
\u00a0
settle the
\u00a0
contracts
\u00a0
net.
Categories
\u00a0
of financial
\u00a0
assets and
\u00a0
liabilities
The categorisation of the financial instrument for
\u00a0
measurement purposes is based on the objective and
\u00a0
the contractual cash flow characteristics
determined at initial recognition. Telenor does not
\u00a0
apply the fair value option.
Telenor has financial assets classified in the following
\u00a0
measurement categories:
\u00a0
\u25cf
FAAC - financial
\u00a0
assets at
\u00a0
amortised
\u00a0
cost. Consist
\u00a0
of financial
\u00a0
assets held
\u00a0
to collect
\u00a0
contractual
\u00a0
cash flows
\u00a0
that are
\u00a0
solely payments
\u00a0
of
principal
\u00a0
and interest.
\u25cf
FVTOCI -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through other
\u00a0
comprehensive
\u00a0
income. Consist
\u00a0
of equity
\u00a0
investments
\u00a0
not held
\u00a0
for trading.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes,
\u00a0
assets held
\u00a0
for
trading
\u00a0
and financial
\u00a0
assets that
\u00a0
are not
\u00a0
classified
\u00a0
in one of
\u00a0
the other
\u00a0
categories.
Telenor has financial liabilities classified in the following
\u00a0
categories:
\u00a0
\u25cf
FLAC - financial
\u00a0
liabilities
\u00a0
at amortised
\u00a0
cost. Consist
\u00a0
of liabilities
\u00a0
that are
\u00a0
not a part
\u00a0
of the category
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
liabilities
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes and
\u00a0
other liabilities
Equity investments include equity instruments and capital contribution
\u00a0
to Telenor Pension Fund. Equity investments not
\u00a0
held for trading are
financial assets with changes in fair value
\u00a0
through other comprehensive income (FVTOCI).
\u00a0
Unrealised gains and losses are reclassified within equity
from other
\u00a0
reserves
\u00a0
to retained
\u00a0
earnings
\u00a0
when the
\u00a0
investment
\u00a0
is disposed.
\u00a0
Equity investments
\u00a0
held for
\u00a0
trading
\u00a0
are financial
\u00a0
assets with
\u00a0
changes in
fair value through profit and loss (FVTPL), and
\u00a0
transaction costs are immediately expensed. Telenor does currently
\u00a0
not have equity instruments held
for trading.
Telenor
\u00a0
uses derivative
\u00a0
financial
\u00a0
instruments
\u00a0
such as forward
\u00a0
currency
\u00a0
contracts,
\u00a0
interest rate
\u00a0
swaps and
\u00a0
cross currency
\u00a0
interest
\u00a0
rate swaps
\u00a0
to
hedge its risks associated with interest rate
\u00a0
and foreign currency fluctuations. The derivative financial instruments are
\u00a0
measured at fair value. Any
gains or
\u00a0
losses arising
\u00a0
from changes
\u00a0
in fair
\u00a0
value on derivatives
\u00a0
that are
\u00a0
not cash flow
\u00a0
hedges or
\u00a0
hedges of
\u00a0
net investments
\u00a0
are recognised
\u00a0
in the
income statement as financial income or expense.
\u00a0
Embedded derivatives
\u00a0
Embedded derivatives are separated from the host
\u00a0
contract and recognised
\u00a0
at fair value, except when the risks and
\u00a0
economic characteristics are
closely
\u00a0
related to
\u00a0
the host contract
\u00a0
and the host
\u00a0
contract
\u00a0
is not carried
\u00a0
at fair value.
\u00a0
The currency
\u00a0
derivative
\u00a0
embedded
\u00a0
in committed
\u00a0
purchase or
sales contracts
\u00a0
are not separated
\u00a0
when the
\u00a0
payment is
\u00a0
in one of
\u00a0
the party\u2019s
\u00a0
functional
\u00a0
currency
\u00a0
or in a commonly
\u00a0
used currency
\u00a0
in the relevant
economic environment. Unrealised gains or losses are
\u00a0
recognised in the income statement.
\u00a0
Other current and non-current financial assets
Financial
\u00a0
assets such
\u00a0
as various
\u00a0
receivables
\u00a0
and deposits
\u00a0
initially
\u00a0
recognised
\u00a0
at fair
\u00a0
value including
\u00a0
directly attributable
\u00a0
transactions
\u00a0
costs and
subsequently measured at amortised cost using the
\u00a0
effective interest rate method. These financial assets
\u00a0
are adjusted for provision for
impairment in accordance with the expected credit loss
\u00a0
model.
\u00a0
Lease receivables
In finance
\u00a0
leases, a
\u00a0
lease receivable
\u00a0
is recognised
\u00a0
based on
\u00a0
future expected
\u00a0
lease payments,
\u00a0
and finance
\u00a0
income is
\u00a0
allocated
\u00a0
using a
\u00a0
constant
periodic
\u00a0
rate of return
\u00a0
over the
\u00a0
lease term.
\u00a0
In a transaction
\u00a0
for which
\u00a0
an underlying
\u00a0
asset is
\u00a0
sub-leased
\u00a0
to a third
\u00a0
party, the
\u00a0
sublease is
\u00a0
classified
\u00a0
as a
finance or
\u00a0
operating
\u00a0
lease by
\u00a0
reference
\u00a0
to the right-of-use
\u00a0
asset arising
\u00a0
from the
\u00a0
head lease.
\u00a0
See note
\u00a0
3 for further
\u00a0
information
\u00a0
about operation
lease revenue.
Supply chain financing agreements
\u00a0
In supply chain financing agreements, the payables are
\u00a0
reclassified from trade payables to current non-interest
\u00a0
bearing liabilities when the
financing arrangements are linked to the payment
\u00a0
terms of the contract with the vendor.
\u00a0
The current liability is presented as
\u00a0
non-interest bearing
as the payment of interest is carried
\u00a0
by the vendor. When the financial institution makes
\u00a0
the payment to the vendor, an operational
\u00a0
cash outflow is
presented
\u00a0
in the Statement
\u00a0
of Cash Flows
\u00a0
if it is
\u00a0
related to
\u00a0
operating
\u00a0
activities
\u00a0
and cash outflow
\u00a0
from investing
\u00a0
activities
\u00a0
if it is related
\u00a0
to investing
activities. At the same time a financial
\u00a0
cash inflow reflecting that a financial liability has
\u00a0
been obtained. The subsequent payment of the financial
liability
\u00a0
is presented as financial cash outflow in
\u00a0
the cash flow statement. Supply chain financing
\u00a0
arrangements that do not have any link
\u00a0
to payment
terms or any
\u00a0
other parts
\u00a0
of the contract
\u00a0
with the
\u00a0
vendor are
\u00a0
classified
\u00a0
as trade
\u00a0
payables.
\u00a0
Cash outflow
\u00a0
from such arrangements
\u00a0
are presented
\u00a0
as
operating
\u00a0
activities
\u00a0
in the Statement
\u00a0
of Cash Flows.
Non-current financial
\u00a0
assets
NOK in millions
4)
Category
2022
2021
Equity investments
3
FVTOCI
1)
937
975
Financial derivatives
2
FVTPL
2)
248
59
Financial derivatives designated for net investment hedge
2
713
27
Other financial
\u00a0
non-current
\u00a0
non-interest-bearing
\u00a0
assets
FAAC
3)
3 066
3 318
Fair value hedge instruments
2
25
927
Other financial
\u00a0
non-current
\u00a0
interest-bearing
\u00a0
assets
FAAC
3)
3 230
970
Finance lease receivable
5)
1 046
1 356
Total non-current financial assets as of 31 December
9 264
7 632
1)
FVTOCI: Fair value through other comprehensive income.
\u00a0
2)
FVTPL: Fair value through profit and loss.
\u00a0
3)
FAAC: Financial assets at amortised cost.
\u00a0
4)
For information about the fair value level of financial
\u00a0
instruments, see note 32.
\u00a0
Equity investments
Equity investments (FVTOCI) include capital contribution to
\u00a0
Telenor Pension Fund of NOK 0.3 billion
\u00a0
and other equity investments of NOK 0.6 billion
(NOK 0.3 billion and NOK 0.7 billion in
\u00a0
2021,
\u00a0
respectively).
Other financial non-current non-interest-bearing assets
Other financial non-current non-interest-bearing
\u00a0
assets as of 31 December 2022 includes
\u00a0
a deposit of NOK 1.9 billion paid to
\u00a0
the Bangladesh
Telecommunication Regulatory Commission (BTRC, see note 23),
\u00a0
long term deposits of NOK 0.3 billion
\u00a0
and other non-current receivables of NOK
0.9 billion
\u00a0
(NOK 2.0
\u00a0
billion, NOK
\u00a0
0.6 billion
\u00a0
and of NOK
\u00a0
0.7 billion
\u00a0
in 2021,
\u00a0
respectively).
Other financial non-current interest-bearing
\u00a0
assets
Other financial
\u00a0
non-current
\u00a0
interest-bearing
\u00a0
assets includes
\u00a0
a receivable
\u00a0
against the
\u00a0
Norwegian
\u00a0
tax authorities
\u00a0
of NOK 2.7
\u00a0
billion related
\u00a0
to the
ongoing court
\u00a0
case for
\u00a0
losses on
\u00a0
receivables
\u00a0
on the Indian
\u00a0
subsidiary
\u00a0
Unitech Wireless
\u00a0
after having
\u00a0
repaid, as
\u00a0
guarantor,
\u00a0
all Unitech
\u00a0
Wireless\u2019
interest-bearing borrowings.
\u00a0
In 2019, Telenor paid an amount of
\u00a0
NOK 2.7 billion after an unfavourable decision by
\u00a0
the Norwegian tax authorities. In
March 2022, Telenor received a favourable verdict
\u00a0
and reversed the tax expense accordingly, see note 10.
Finance
\u00a0
lease receivables
Telenor has recognised receivables at present value
\u00a0
of future lease payments to be received in
\u00a0
lease arrangements where Telenor has transferred
substantially
\u00a0
all the risks
\u00a0
and rewards
\u00a0
incidental
\u00a0
to ownership
\u00a0
of the underlying
\u00a0
assets to
\u00a0
the lessee.
\u00a0
Current finance
\u00a0
lease receivables
\u00a0
are included
in Trade and other receivables (see note 19).
2022
2021
NOK in millions
Current
Non-current
Total
Current
Non-current
Total
Sublease of land
361
973
1 334
329
1 203
1 533
Lease of satellite
97
72
169
94
153
247
Total finance
\u00a0
lease receivables
458
1 046
1 504
423
1 356
1 779
During 2022, the Group recognised interest income
\u00a0
of NOK 60 million (NOK 73 million
\u00a0
in 2021) (note 9) related to finance lease receivables.
Dtac has Tower Service Agreement with the National
\u00a0
Telecom Public Company Limited (NT) and under the agreement,
\u00a0
dtac transferred towers that
dtac procured
\u00a0
under the
\u00a0
concession
\u00a0
agreement
\u00a0
to operate
\u00a0
and to provide
\u00a0
cellular
\u00a0
telephonic
\u00a0
service and
\u00a0
entered into
\u00a0
lease agreement
\u00a0
to use the
towers. The right to use towers from
\u00a0
NT was recognised as right-of-use asset with
\u00a0
corresponding lease liability. Under the agreement, dtac
\u00a0
shall
itself have lease agreements for the land
\u00a0
with landowners and shall receive compensation from NT
\u00a0
for this. dtac recognised lease agreements as a
lessee with
\u00a0
the landowners
\u00a0
for the land
\u00a0
related to
\u00a0
transferred
\u00a0
towers to
\u00a0
NT with
\u00a0
related lease
\u00a0
liabilities.
\u00a0
Right-of-use
\u00a0
assets related
\u00a0
to land was
derecognised on 1 January 2019 based on the
\u00a0
sublease arrangement with NT and a finance lease
\u00a0
receivable was recognised with reference to the
tenure of the agreement with NT.
\u00a0
The Group
\u00a0
entered into
\u00a0
a long-term
\u00a0
lease with
\u00a0
UPC on 1
\u00a0
April 2017
\u00a0
for the lease
\u00a0
of 9 transponders
\u00a0
on Thor
\u00a0
6, where
\u00a0
the final
\u00a0
payment from
\u00a0
UPC will
be made in
\u00a0
January 2025.
\u00a0
According
\u00a0
to the agreement,
\u00a0
substantially
\u00a0
all the risks
\u00a0
and rewards
\u00a0
related
\u00a0
to Thor 6
\u00a0
are transferred
\u00a0
to UPC, and
accordingly a finance lease receivable was recognised at present
\u00a0
value, which represents the deferred payments to
\u00a0
be received until January 2025.
\u00a0
The following
\u00a0
table sets
\u00a0
forth the
\u00a0
maturity
\u00a0
analysis
\u00a0
of lease
\u00a0
receivables:
NOK in millions
2022
2021
506
438
1 to 2 years
445
449
2 to 3 years
384
415
3 to 4 years
272
360
4 to 5 years
-
269
After 5 years
-
-
Total undiscounted lease payments receivable
1 607
1 931
Unearned
\u00a0
interest income
( 103)
( 152)
Net investment in leases
1 504
1 779
Current financial
\u00a0
assets
NOK in millions
3)
Category
2022
2021
Assets held
\u00a0
for trading
2
FVTPL
1)
50
48
Bonds and commercial papers > 3 months
FAAC
2)
277
327
Financial derivatives
\u00a0
2
FVTPL
1)
29
1
Financial derivatives designated for net investment hedge
2
2
320
Fair value hedge instruments
2
2
143
Total other current financial assets as of 31 December
361
839
Non-current
\u00a0
non-interest-bearing
\u00a0
liabilities
NOK in millions
3)
Category
2022
2021
Financial derivatives
\u00a0
2
FVTPL
1)
149
156
Financial derivatives designated for net investment hedge
2
1 306
950
Other non-current non-interest-bearing
\u00a0
liabilities
FLAC
2)
317
282
Total non-current non-interest-bearing
\u00a0
liabilities as of 31 December
1 772
1 388
Current non-interest-bearing
\u00a0
liabilities
NOK in millions
3)
Category
2022
2021
Financial derivatives
\u00a0
2
FVTPL
1)
3
6
Financial derivatives designated for net investment hedge
2
382
669
Other current non-interest-bearing
\u00a0
liabilities
FLAC
2)
1 308
1 294
Total current non-interest-bearing
\u00a0
liabilities as of 31 December
1 694
1 969
1)
FVTPL: Fair value through profit and loss.
2)
FLAC: Financial liabilities at amortised cost.
3)
For information about the fair value level of financial
\u00a0
instruments, see note 32.
Other current non-interest-bearing
\u00a0
liabilities include liabilities to financing institutions under supply
\u00a0
chain financing programs of NOK 616 million as
of 31 December 2022 (NOK 596 million as
\u00a0
of 31 December 2021).
NOTE 19
Trade and other receivables
Accounting policies
Trade and other receivables are recognised at fair value including
\u00a0
directly attributable transaction costs and subsequently measured at
amortised cost using the effective interest rate method. A customer
\u00a0
contract asset is recognised when the revenue from contracts with
customers exceeds the amounts received,
\u00a0
for example when sale of handsets
\u00a0
or other customer equipment is recovered through future
subscription fee payments. Contract assets are transferred to trade receivables
\u00a0
when the rights to payment become unconditional, which
is normally when the invoice has been issued. Refer
\u00a0
to further information in note 3 Revenues.
Key judgments
\u00a0
and estimates
Trade receivables and contract assets are adjusted
\u00a0
for provision for impairment in accordance with
\u00a0
the expected credit loss model. The simplified
approach
\u00a0
is applied
\u00a0
measuring
\u00a0
the loss allowance
\u00a0
at an amount
\u00a0
equal to
\u00a0
lifetime
\u00a0
expected
\u00a0
credit losses.
\u00a0
Impairment
\u00a0
for expected
\u00a0
credit losses
\u00a0
is
assessed every reporting period and calculated by considering
\u00a0
the historic evidence of the level of
\u00a0
bad debt experienced for customer types and
the aging of the receivable balance.
Trade and other
\u00a0
receivables
NOK in millions
Category
2022
2021
Receivables
\u00a0
from contracts
\u00a0
with customers
15 245
15 490
Provision for expected credit losses on trade receivables
(894)
(998)
Total receivables from contracts with customers as of
\u00a0
31 December
FAAC
1)
14 352
14 492
Interest-bearing receivables
3)
35
1 051
Finance lease receivable
4)
458
423
Other non-interest-bearing
\u00a0
receivables
1 648
2 334
Provision for expected credit losses on other current
\u00a0
receivables
(13)
(15)
Total other current receivables as of 31 December
FAAC
1)
2 128
3 793
Contract asset
216
362
5)
85
71
Governmental taxes and duties
388
685
1 674
2 336
Total other current non-financial assets as of 31 December
NF
2)
2 362
3 455
Total trade and other receivables as of 31 December
18 842
21 739
1)
FAAC: Financial assets at amortised cost
2)
NF: Non-financial assets and liabilities
3)
In 2021, this includes the current portion of the deferred
\u00a0
sales consideration receivable from PPF Group for
\u00a0
the sale of shares in Telenor Serbia in 2018.
\u00a0
4)
See note 27 for more information
5)
Asset for the right to recover returned goods on settling
\u00a0
refund liabilities.
As of 31
\u00a0
December
\u00a0
2022, NOK
\u00a0
3.1 billion
\u00a0
(NOK 3.1
\u00a0
billion as
\u00a0
of 31 December
\u00a0
2021) of
\u00a0
trade and
\u00a0
other receivables
\u00a0
relates to
\u00a0
handset instalments
\u00a0
not
due within
\u00a0
one year.
Specification
\u00a0
of contract assets
NOK in millions
2022
2021
Balance as of 1 January
362
412
New contract assets during the period less
\u00a0
transfer to receivables
93
( 41)
Disposal
\u00a0
of subsidiaries
( 263)
-
Currency
\u00a0
and other
\u00a0
effects
24
( 9)
Balance as of 31 December
216
362
Specification
\u00a0
of provision for
\u00a0
expected credit
\u00a0
losses on trade
\u00a0
receivables
NOK in millions
2022
2021
Provision as of 1 January
( 998)
(1 268)
Change during the year - continuing operations
( 91)
111
Change during the year - discontinued operations
77
55
Disposal
\u00a0
of subsidiaries
131
-
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
-
49
Currency
\u00a0
and other
\u00a0
effects
( 13)
55
Provision as of 31 December
( 894)
( 998)
Realised losses for the year - continuing
\u00a0
operations
( 549)
( 629)
Realised losses for the year - discontinued
\u00a0
operations
( 137)
( 203)
Recovered amounts previously provided for - continuing operations
37
39
Recovered amounts previously provided for - discontinued operations
45
46
Specification
\u00a0
of the age distribution
\u00a0
of trade receivables
Past due on
\u00a0
the reporting
\u00a0
date in the
\u00a0
following periods:
NOK in millions
Carrying
amount
reporting date
60 days
90 days
180 days
365 days
More than
365 days
As of 31 December 2022
Trade receivables
15 245
12 567
1 077
263
135
324
347
532
Provision for expected
credit losses
\u00a0
on trade
receivables
( 894)
( 65)
( 42)
( 34)
( 45)
( 129)
( 218)
( 360)
Total trade receivables
14 352
12 502
1 035
229
89
194
130
172
As of 31 December 2021
Trade receivables
15 490
12 825
990
239
137
277
399
621
Provision for expected
credit losses
\u00a0
on trade
receivables
( 998)
( 101)
( 43)
( 45)
( 51)
( 135)
( 229)
( 394)
Total trade receivables
14 492
12 724
947
194
86
142
171
227
For the trade
\u00a0
and other
\u00a0
current receivables
\u00a0
that are
\u00a0
not impaired
\u00a0
or past due,
\u00a0
there are
\u00a0
no indicators
\u00a0
at the date
\u00a0
of the reporting
\u00a0
that the debtors
will not
\u00a0
be able
\u00a0
to meet their
\u00a0
payment obligations.
NOTE 19
Trade and other receivables
Accounting policies
Trade and other receivables are recognised at fair value including
\u00a0
directly attributable transaction costs and subsequently measured at
amortised cost using the effective interest rate method. A customer
\u00a0
contract asset is recognised when the revenue from contracts with
customers exceeds the amounts received,
\u00a0
for example when sale of handsets
\u00a0
or other customer equipment is recovered through future
subscription fee payments. Contract assets are transferred to trade receivables
\u00a0
when the rights to payment become unconditional, which
is normally when the invoice has been issued. Refer
\u00a0
to further information in note 3 Revenues.
Key judgments
\u00a0
and estimates
Trade receivables and contract assets are adjusted
\u00a0
for provision for impairment in accordance with
\u00a0
the expected credit loss model. The simplified
approach
\u00a0
is applied
\u00a0
measuring
\u00a0
the loss allowance
\u00a0
at an amount
\u00a0
equal to
\u00a0
lifetime
\u00a0
expected
\u00a0
credit losses.
\u00a0
Impairment
\u00a0
for expected
\u00a0
credit losses
\u00a0
is
assessed every reporting period and calculated by considering
\u00a0
the historic evidence of the level of
\u00a0
bad debt experienced for customer types and
the aging of the receivable balance.
Trade and other
\u00a0
receivables
NOK in millions
Category
2022
2021
Receivables
\u00a0
from contracts
\u00a0
with customers
15 245
15 490
Provision for expected credit losses on trade receivables
(894)
(998)
Total receivables from contracts with customers as of
\u00a0
31 December
FAAC
1)
14 352
14 492
Interest-bearing receivables
3)
35
1 051
Finance lease receivable
4)
458
423
Other non-interest-bearing
\u00a0
receivables
1 648
2 334
Provision for expected credit losses on other current
\u00a0
receivables
(13)
(15)
Total other current receivables as of 31 December
FAAC
1)
2 128
3 793
Contract asset
216
362
5)
85
71
Governmental taxes and duties
388
685
1 674
2 336
Total other current non-financial assets as of 31 December
NF
2)
2 362
3 455
Total trade and other receivables as of 31 December
18 842
21 739
1)
FAAC: Financial assets at amortised cost
2)
NF: Non-financial assets and liabilities
3)
In 2021, this includes the current portion of the deferred
\u00a0
sales consideration receivable from PPF Group for
\u00a0
the sale of shares in Telenor Serbia in 2018.
\u00a0
4)
See note 27 for more information
5)
Asset for the right to recover returned goods on settling
\u00a0
refund liabilities.
As of 31
\u00a0
December
\u00a0
2022, NOK
\u00a0
3.1 billion
\u00a0
(NOK 3.1
\u00a0
billion as
\u00a0
of 31 December
\u00a0
2021) of
\u00a0
trade and
\u00a0
other receivables
\u00a0
relates to
\u00a0
handset instalments
\u00a0
not
due within
\u00a0
one year.
Specification
\u00a0
of contract assets
NOK in millions
2022
2021
Balance as of 1 January
362
412
New contract assets during the period less
\u00a0
transfer to receivables
93
( 41)
Disposal
\u00a0
of subsidiaries
( 263)
-
Currency
\u00a0
and other
\u00a0
effects
24
( 9)
Balance as of 31 December
216
362
Specification
\u00a0
of provision for
\u00a0
expected credit
\u00a0
losses on trade
\u00a0
receivables
NOK in millions
2022
2021
Provision as of 1 January
( 998)
(1 268)
Change during the year - continuing operations
( 91)
111
Change during the year - discontinued operations
77
55
Disposal
\u00a0
of subsidiaries
131
-
Reclassified
\u00a0
to assets
\u00a0
held for
\u00a0
sale
-
49
Currency
\u00a0
and other
\u00a0
effects
( 13)
55
Provision as of 31 December
( 894)
( 998)
Realised losses for the year - continuing
\u00a0
operations
( 549)
( 629)
Realised losses for the year - discontinued
\u00a0
operations
( 137)
( 203)
Recovered amounts previously provided for - continuing operations
37
39
Recovered amounts previously provided for - discontinued operations
45
46
Specification
\u00a0
of the age distribution
\u00a0
of trade receivables
Past due on
\u00a0
the reporting
\u00a0
date in the
\u00a0
following periods:
NOK in millions
Carrying
amount
reporting date
60 days
90 days
180 days
365 days
More than
365 days
As of 31 December 2022
Trade receivables
15 245
12 567
1 077
263
135
324
347
532
Provision for expected
credit losses
\u00a0
on trade
receivables
( 894)
( 65)
( 42)
( 34)
( 45)
( 129)
( 218)
( 360)
Total trade receivables
14 352
12 502
1 035
229
89
194
130
172
As of 31 December 2021
Trade receivables
15 490
12 825
990
239
137
277
399
621
Provision for expected
credit losses
\u00a0
on trade
receivables
( 998)
( 101)
( 43)
( 45)
( 51)
( 135)
( 229)
( 394)
Total trade receivables
14 492
12 724
947
194
86
142
171
227
For the trade
\u00a0
and other
\u00a0
current receivables
\u00a0
that are
\u00a0
not impaired
\u00a0
or past due,
\u00a0
there are
\u00a0
no indicators
\u00a0
at the date
\u00a0
of the reporting
\u00a0
that the debtors
will not
\u00a0
be able
\u00a0
to meet their
\u00a0
payment obligations.
Accounting policies
Trade and other receivables are recognised at fair value including
\u00a0
directly attributable transaction costs and subsequently measured at
amortised cost using the effective interest rate method. A customer
\u00a0
contract asset is recognised when the revenue from contracts with
customers exceeds the amounts received,
\u00a0
for example when sale of handsets
\u00a0
or other customer equipment is recovered through future
subscription fee payments. Contract assets are transferred to trade receivables
\u00a0
when the rights to payment become unconditional, which
is normally when the invoice has been issued. Refer
\u00a0
to further information in note 3 Revenues.
NOTE 20
Cash and cash equivalents
Accounting policies
Cash and cash equivalents include bank deposits,
\u00a0
fixed rate bonds and commercial papers with original maturity
\u00a0
of three months or less which are
readily convertible
\u00a0
to known
\u00a0
amount of
\u00a0
cash and
\u00a0
subject to
\u00a0
insignificant
\u00a0
risk.
Cash and cash
\u00a0
equivalents
NOK in millions
2022
2021
Cash in the
\u00a0
group\u2019s cash
\u00a0
pool systems
2 667
4 976
Cash outside
\u00a0
the group\u2019s
\u00a0
cash pool
\u00a0
systems
1)
7 262
9 777
Cash equivalents
2)
-
470
Total cash and cash equivalents in statement of financial position
9 929
15 223
Bank overdraft
\u00a0
(part of
\u00a0
cash in statement
\u00a0
of cash flows)
( 252)
( 102)
Total cash and cash equivalents in statement of cash
\u00a0
flows
9 677
15 121
1)
Includes restricted cash in Grameenphone of NOK 10
\u00a0
million as of 31 December 2022 (NOK 10 million
\u00a0
as of 31 December 2021).
2)
Related to fixed deposit placements with shorter than
\u00a0
3 months maturity in Digi and Telenor ASA in
\u00a0
2021.
Telenor
\u00a0
has established
\u00a0
cash pool
\u00a0
arrangements
\u00a0
where Telenor
\u00a0
ASA is the
\u00a0
account holder
\u00a0
and the other
\u00a0
companies
\u00a0
in the group
\u00a0
are sub-account
holders or
\u00a0
participants.
\u00a0
The cash
\u00a0
pool arrangements
\u00a0
allow netting
\u00a0
of cash positions
\u00a0
within the
\u00a0
group. Subsidiaries
\u00a0
in which Telenor
\u00a0
owns less
\u00a0
than
90% of the
\u00a0
shares are
\u00a0
normally
\u00a0
not participants
\u00a0
in the cash
\u00a0
pool arrangements
\u00a0
held by
\u00a0
Telenor ASA.
\u00a0
As of 31 December
\u00a0
2022 the major
\u00a0
part of the
cash and
\u00a0
cash equivalents
\u00a0
outside
\u00a0
the cash
\u00a0
pool arrangements
\u00a0
relates to
\u00a0
Telenor
\u00a0
ASA,
\u00a0
dtac and
\u00a0
Grameenphone.
\u00a0
For 2021
\u00a0
the major
\u00a0
part of the
cash and cash equivalents outside the cash
\u00a0
pool systems relates to Telenor ASA, dtac, Grameenphone
\u00a0
and Telenor Pakistan.
Accounting policies
Cash and cash equivalents include bank deposits,
\u00a0
fixed rate bonds and commercial papers with original maturity
\u00a0
of three months or less which are
readily convertible
\u00a0
to known
\u00a0
amount of
\u00a0
cash and
\u00a0
subject to
\u00a0
insignificant
\u00a0
risk.
NOTE 21
Pension obligations
Telenor offer several different pension plans to its employees.
\u00a0
The most common pension plan is the defined
contribution plan where a contribution is made to the employee\u2019s individual
\u00a0
pension account. This arrangement is
in addition to the plans organised by governments providing
\u00a0
a basic pension entitlement to all taxpayers. Telenor
also has defined benefit plans with future pension obligations
\u00a0
that are mostly closed for new members.
Accounting policies
Defined contribution plans
A defined contribution plan is a type of
\u00a0
retirement plan where the employer makes contributions on
\u00a0
a regular basis to the employee\u2019s individual
pension account. The benefits received by the
\u00a0
employee are based on the employer contributions and gains
\u00a0
or losses from investing the capital.
Contributions
\u00a0
to defined contribution pension plans are recognised
\u00a0
as an expense in the income statement
\u00a0
as incurred.
Defined benefit plans
A defined benefit plan is a pension plan
\u00a0
where the employer promises an annual pension
\u00a0
on retirement based on a percentage of
\u00a0
the salary upon
retirement and the employee's earnings history, years
\u00a0
of service and age. The pension obligations are
\u00a0
determined by discounting the estimated
future pension
\u00a0
cash outflows
\u00a0
less the
\u00a0
fair value
\u00a0
of plan assets.
\u00a0
The discount
\u00a0
rate is based
\u00a0
on interest
\u00a0
rates of
\u00a0
high-quality
\u00a0
corporate
\u00a0
bonds
denominated in the same currency and with
\u00a0
similar maturity as the related pension obligation. The defined
\u00a0
benefit obligation is calculated annually
by independent
\u00a0
actuaries
\u00a0
using the
\u00a0
projected
\u00a0
unit credit
\u00a0
method.
Current and
\u00a0
past service
\u00a0
cost in
\u00a0
addition
\u00a0
to non-routine
\u00a0
pension settlements,
\u00a0
is presented
\u00a0
as salaries
\u00a0
and personnel
\u00a0
costs, and
\u00a0
the net interest
expense is recognised as financial expense in
\u00a0
the income statement. Remeasurements including actuarial gains and losses and
\u00a0
the return on plan
assets exceeding the discount rate are recognised
\u00a0
in the statement of comprehensive income and
\u00a0
are not subsequently reclassified to the income
statement.
A plan curtailment is when Telenor is committed
\u00a0
to reduce the number of employees in a
\u00a0
plan or change the terms, so the
\u00a0
employees are entitled
to reduced benefits or is no longer
\u00a0
eligible for benefits. Past service cost is recognised in
\u00a0
the income statement on the earlier of
\u00a0
the date of the plan
amendment
\u00a0
or curtailment
\u00a0
or when
\u00a0
the related
\u00a0
restructuring
\u00a0
cost is recognised.
\u00a0
Gains and
\u00a0
losses on
\u00a0
curtailments
\u00a0
form part
\u00a0
of service
\u00a0
cost and
\u00a0
are
presented
\u00a0
as part of
\u00a0
other income
\u00a0
or other expenses
\u00a0
in the income
\u00a0
statement.
\u00a0
Defined benefit multi-employer plans
\u00a0
(such as the AFP arrangement in
\u00a0
Norway) are accounted for as defined contribution
\u00a0
plans when insufficient
information
\u00a0
is available
\u00a0
to calculate
\u00a0
Telenor\u2019s
\u00a0
proportionate
\u00a0
share.
Key judgments
\u00a0
and estimates
The present value of the pension obligations
\u00a0
depends on a number of actuarial assumptions, including
\u00a0
the discount rate, expected salary growth,
inflation and return on assets as well
\u00a0
as demographical factors concerning mortality, employee turnover,
\u00a0
disability and early retirement.
Assumptions
\u00a0
about all
\u00a0
these factors
\u00a0
are based
\u00a0
on the situation
\u00a0
at the time
\u00a0
the assessment
\u00a0
is made,
\u00a0
whereas it
\u00a0
is expected
\u00a0
that such factors
\u00a0
will
change over
\u00a0
the long
\u00a0
periods for
\u00a0
which pension
\u00a0
calculations
\u00a0
are made.
\u00a0
Any changes
\u00a0
in these assumptions
\u00a0
will affect
\u00a0
the calculated
\u00a0
pension
obligations with immediate recognition in other comprehensive
\u00a0
income.
Significant pension
\u00a0
arrangements
\u00a0
in Telenor
Telenor
\u00a0
provides
\u00a0
pension plans
\u00a0
for employees
\u00a0
in Norway
\u00a0
which follow
\u00a0
the requirements
\u00a0
in the Act
\u00a0
on Mandatory
\u00a0
company pensions.
\u00a0
In addition,
the Norwegian government provides social security payments
\u00a0
to all retired Norwegian citizens. Such payments
\u00a0
are calculated by reference to a
base amount annually approved by the Norwegian
\u00a0
parliament (G-regulation). Benefits are determined based on
\u00a0
the employee\u2019s length of service
and compensation. The cost of pension benefit
\u00a0
plans is expensed over the period that
\u00a0
the employees render services and becomes eligible
\u00a0
to
Telenor Pension Fund, covering the defined benefit plans
\u00a0
offered to all employees in Norway, was closed to
\u00a0
new members during 2006 and
replaced by defined contribution plans with insurance companies.
\u00a0
In Norway, 3 575 of the employees
\u00a0
were members of the contribution plan as
\u00a0
of 31 December 2022 (3 383 as of 31 December
\u00a0
2021). In 2022, 1 022 of
the employees
\u00a0
were covered
\u00a0
by the defined
\u00a0
benefit plans
\u00a0
through Telenor
\u00a0
Pension Fund
\u00a0
(1 135 in
\u00a0
2021). In addition,
\u00a0
Telenor Pension
\u00a0
Fund paid
\u00a0
out
pensions to 2 516 persons in 2022 (2
\u00a0
475 in 2021). Telenor Sweden has
\u00a0
a defined benefit plan with 588 active
\u00a0
members in 2022 (614 in 2021). Other
companies outside Norway and Sweden primarily offer
\u00a0
contribution plans.
\u00a0
The funded
\u00a0
defined benefit
\u00a0
plans in Norway
\u00a0
have net
\u00a0
funds of
\u00a0
NOK 858
\u00a0
million as
\u00a0
of 31 December
\u00a0
2022 (NOK
\u00a0
618 million
\u00a0
in net funds
\u00a0
as of 31
December
\u00a0
2021). The
\u00a0
current service
\u00a0
cost was NOK
\u00a0
178 million
\u00a0
in 2022 (NOK
\u00a0
174 million
\u00a0
in 2021).
\u00a0
Net interest
\u00a0
income was
\u00a0
NOK 15 million
\u00a0
(interest
income of NOK 10 million in 2021).
\u00a0
Unfunded defined benefit plans have previously been
\u00a0
offered to executive employees. These plans are
\u00a0
now closed. As of 31 December 2022, the
net defined benefit liability recognised in the
\u00a0
statement
\u00a0
of financial position was NOK 636 million (NOK
\u00a0
684 million as of 31 December 2021). The
service cost was NOK 8 million in 2022 (NOK 8
\u00a0
million in 2021). Net interest cost was
\u00a0
NOK 13 million (NOK 11 million in
\u00a0
2021). Telenor does not have a
right to use the net funds in
\u00a0
the funded plans to settle the obligations
\u00a0
under the unfunded plans.
\u00a0
Telenor
\u00a0
is member
\u00a0
of an agreement-based
\u00a0
early retirement
\u00a0
plan (new
\u00a0
AFP) in Norway.
\u00a0
Essentially
\u00a0
all the Norwegian
\u00a0
employees
\u00a0
are entitled
\u00a0
to life-
long benefits
\u00a0
from the
\u00a0
age of 62
\u00a0
from this
\u00a0
plan, in
\u00a0
addition
\u00a0
to other plans.
\u00a0
The plan
\u00a0
is financed
\u00a0
through a
\u00a0
pooled arrangement,
\u00a0
where private
\u00a0
sector
employers cover 2/3 of the funding requirements
\u00a0
and the Norwegian government covers 1/3. For 2022,
\u00a0
the contribution was 2.6% of total salaries
between 1 and 7.1 times the base amount
\u00a0
(G) (2.5% for 2021). For
\u00a0
2023, the contribution is set to 2.6%.
\u00a0
The plan is considered to be a defined benefit
multi-employer plan with limited
\u00a0
funding and where plan assets are not
\u00a0
segregated. The information required to calculate a
\u00a0
proportionate share of
the plan,
\u00a0
and account
\u00a0
for the plan
\u00a0
as a defined
\u00a0
benefit plan,
\u00a0
is not available
\u00a0
from the
\u00a0
plan administrator.
\u00a0
Consequently,
\u00a0
the plan
\u00a0
is accounted
\u00a0
for as
a defined contribution plan.
\u00a0
The defined benefit plan in Sweden has a
\u00a0
net benefit liability of NOK 918 million
\u00a0
as of 31 December 2022 (NOK 1 372
\u00a0
million as of 31 December 2021).
The service cost was NOK 58 million
\u00a0
and net interest cost was NOK
\u00a0
29 million in 2022 (NOK 82 million and NOK 21
\u00a0
million in 2021, respectively). The
discount rate used for the pension calculations
\u00a0
as of 31 December 2022 was 3.9% (2.0% in 2021)
\u00a0
and expected salary increase was set to 3.0%
For the Norwegian defined benefit plans, the Group
\u00a0
applies the K2013 risk table for mortality and
\u00a0
a risk table for disability based on
\u00a0
historical figures
in Telenor
\u00a0
Pension Fund
\u00a0
(both implemented
\u00a0
in 2013).
\u00a0
The average
\u00a0
expected lifetime
\u00a0
in the risk
\u00a0
tables is 88
\u00a0
years for
\u00a0
men and 91
\u00a0
years for
\u00a0
women.
\u00a0
The table
\u00a0
below shows
\u00a0
the probability
\u00a0
of an employee
\u00a0
in a certain
\u00a0
age group
\u00a0
becoming
\u00a0
disabled
\u00a0
or dying,
\u00a0
within one
\u00a0
year, as
\u00a0
well as expected
lifetime.
Expected lifetime
Age
Men
Women
Men
Women
Men
Women
40
0.1
0.0
0.1
0.1
88
92
50
0.1
0.1
0.2
0.3
88
91
60
0.4
0.3
0.8
1.2
87
91
70
1.1
0.8
-
-
88
91
80
3.8
2.6
-
-
90
92
The plan assets were measured at fair
\u00a0
value 31 December 2022 and 31 December 2021. The calculation of
\u00a0
the projected benefit obligations (PBO) as
of 31 December 2022 was based on the
\u00a0
member base at 11 October 2022 (at 20 October 2021).
The actuarial
\u00a0
calculations
\u00a0
for the Telenor
\u00a0
Pension Fund
\u00a0
obligations
\u00a0
were carried
\u00a0
out by independent
\u00a0
actuaries.
\u00a0
The present
\u00a0
value of
\u00a0
the projected
defined
\u00a0
benefit obligation,
\u00a0
and the related
\u00a0
current service
\u00a0
cost and
\u00a0
past service
\u00a0
cost, were
\u00a0
measured
\u00a0
using the
\u00a0
projected
\u00a0
unit
\u00a0
credit method.
Employees in Norway that leave Telenor before the
\u00a0
age of retirement receive a paid-up
\u00a0
policy. Telenor Pension Fund administers some of
\u00a0
these
policies.
\u00a0
This is
\u00a0
at the discretion
\u00a0
of the Telenor
\u00a0
Pension Fund
\u00a0
and does not
\u00a0
affect Telenor.
\u00a0
At the time
\u00a0
of issuance
\u00a0
of a paid-up
\u00a0
policy, Telenor
\u00a0
is
relieved
\u00a0
of any further
\u00a0
obligations
\u00a0
towards the
\u00a0
receiver.
\u00a0
The funds
\u00a0
and obligations
\u00a0
are valued
\u00a0
at the time
\u00a0
of issuance
\u00a0
of paid-up
\u00a0
policies and
\u00a0
are
derecognised
\u00a0
from pension
\u00a0
obligations
\u00a0
and plan
\u00a0
assets.
Changes in the defined benefit obligation and fair value of plan assets
2022
2021
NOK in millions
Defined benefit
obligation
assets
Benefit liability
Defined benefit
obligation
assets
Benefit liability
As of 1 January
(10 432)
8 624
(1 808)
(10 231)
7 913
(2 318)
Current service
\u00a0
cost
( 307)
-
( 307)
( 337)
-
( 337)
-
-
-
26
-
26
Net interest
( 227)
185
( 42)
( 189)
155
( 34)
Discontinued
\u00a0
operations
-
-
-
-
-
-
Sub-total included in Income Statement
( 534)
185
( 349)
( 501)
155
( 345)
Return on
\u00a0
plan assets
\u00a0
(excluding
\u00a0
amounts
included in net interest expense)
-
( 632)
( 632)
-
327
327
Actuarial
\u00a0
changes arising
\u00a0
from changes
\u00a0
in
demographic
\u00a0
assumptions
( 31)
-
( 31)
( 10)
-
( 10)
Actuarial
\u00a0
changes arising
\u00a0
from changes
\u00a0
in
financial
\u00a0
assumptions
1 421
-
1 421
( 65)
-
( 65)
Experience
\u00a0
adjustments
1)
( 96)
-
( 96)
15
-
15
Sub-total in Other Comprehensive Income
1 294
( 632)
661
( 61)
327
266
Effects of
\u00a0
business combinations
\u00a0
and disposals
( 2)
1
( 1)
( 3)
-
( 3)
Contributions by employer
-
323
323
-
448
449
Benefits paid
380
( 304)
76
321
( 303)
18
Translation differences
65
( 26)
39
41
84
125
(9 230)
8 171
(1 059)
(10 432)
8 624
(1 808)
Of which
\u00a0
classified
\u00a0
as:
Pension obligations
(1 919)
(2 429)
Other non-current
\u00a0
assets
2)
859
620
1)
Telenor does not have a right to use the net funds
\u00a0
in the funded plans to settle the obligations under
\u00a0
the unfunded plans.
2)
Experience adjustments on benefit obligations are the
\u00a0
effects of differences between previous actuarial
\u00a0
assumptions and what has actually occurred.
Assumptions used to determine defined benefit obligations for Norwegian companies
\u00a0
as of 31 December
2022
2021
3.00
1.90
Future salary
\u00a0
increase
\u00a0
in %
3.00
2.50
Future increase
\u00a0
in the social
\u00a0
security
\u00a0
base amount
\u00a0
in %
3.25
2.50
Future turnover
\u00a0
in %
3.00
3.00
Future pension
\u00a0
increases
\u00a0
in %
2.00
1.75
Expected average remaining service period in years
7
7
Telenor has
\u00a0
used the
\u00a0
Norwegian
\u00a0
covered bonds
\u00a0
(OMF \u2013 Obligasjoner
\u00a0
med fortrinnsrett)
\u00a0
as basis
\u00a0
for the
\u00a0
discount rate
\u00a0
as of 31
\u00a0
December
\u00a0
for both
2022 and 2021 for the Norwegian plans. OMFs are
\u00a0
covered bonds issued by mortgage companies owned
\u00a0
by Norwegian banks under a well-
established legal framework. Generally, bonds with ratings better
\u00a0
than AA are considered to be of
\u00a0
high quality. Most OMFs have AAA rating.
Components of net periodic benefit cost
NOK in millions
2022
2021
Current service
\u00a0
cost
( 307)
( 337)
-
26
( 42)
( 34)
Net periodic benefit costs
( 349)
( 345)
Contribution
\u00a0
plan costs
( 707)
( 709)
Total pension costs charged to the income statement for the year
(1 056)
(1 054)
Of which reported as other expense (note
\u00a0
8)
\u00a0
( 10)
19
Of which
\u00a0
reported
\u00a0
as pension
\u00a0
cost (note
\u00a0
5)
(1 004)
(1 039)
Of which
\u00a0
reported
\u00a0
as net interest
\u00a0
cost (note
\u00a0
9)
( 42)
( 34)
Sensitivity
\u00a0
analysis
The table
\u00a0
below shows
\u00a0
an estimate
\u00a0
of the potential
\u00a0
effects of
\u00a0
changes in
\u00a0
the key
\u00a0
assumptions
\u00a0
for the
\u00a0
defined
\u00a0
benefit plans
\u00a0
in Norway.
\u00a0
The
following estimates are based on facts and circumstances
\u00a0
as of 31 December 2022.
\u00a0
Actual results may deviate materially from these
\u00a0
estimates.
NOK in millions
Future salary
\u00a0
increase
Social security
\u00a0
base
amounts
Annual adjustments
\u00a0
to
pensions
Turnover
Change in
\u00a0
% is percentage
\u00a0
points
-1%
+1%
-1%
+1%
-1%
+1%
-1%
+1%
-1%
+1%
Changes in:
Increase (decrease) in benefit obligations
1 279
( 989)
( 389)
389
89
( 132)
( 783)
936
42
( 84)
Asset categories
Telenor Pension Fund\u2019s weighted average asset allocations as
\u00a0
of 31 December, by asset category, were as
\u00a0
follows:
2022
2021
Bonds %
61
58
35
36
Other %
4
5
Total
100
100
The bond investments are in securities issued
\u00a0
by the Norwegian government, Norwegian municipals, financial institutions, and corporations. Bonds
held in foreign currencies are to a large
\u00a0
extent currency hedged. Equity investments are both
\u00a0
in Norwegian and foreign securities. There is no
currency hedging for investments in foreign equity
\u00a0
securities. The category Other consist mainly of
\u00a0
investments in Private Equity and Hedge fonds.
Contributions in future years
Expected contributions to the Telenor Pension Fund in
\u00a0
2023 is approximately NOK 288 million.
\u00a0
The following table shows expected benefit payments from
\u00a0
the Norwegian defined benefit plans in future years:
NOK in millions
Within the
\u00a0
next 12
\u00a0
months (next
\u00a0
annual reporting
\u00a0
period)
201
Between 2 and 5 years
906
Next 5 years
1 642
Total expected payments next 10 years
2 749
The average duration of the Norwegian defined benefit
\u00a0
plans at the end of the reporting
\u00a0
period is 15 years.
NOTE 5
Salaries and personnel costs
The Group has around 14 000 full-time equivalent employees.
\u00a0
The employees have various benefits in addition to
salary, including a share-based payment program that is described
\u00a0
in this note.
\u00a0
Overview of
\u00a0
salary and personnel
\u00a0
costs
NOK in millions
2022
2021
Salaries
\u00a0
and holiday
\u00a0
pay
(8 753)
(8 688)
( 924)
( 910)
Pension costs
\u00a0
including
\u00a0
social security
\u00a0
tax (note
\u00a0
21)
(1 004)
(1 039)
Share-based
\u00a0
payments
( 116)
( 131)
Other personnel
\u00a0
costs
( 468)
( 466)
Own work capitalised
1 268
1 219
Total salaries and personnel costs
(9 998)
(10 014)
1)
Include expenses related to the Group's employee share
\u00a0
programme, and the Group's long term incentive
\u00a0
programme for managers and key personnel
\u00a0
(please
refer to note 37 as well as chapter 11 of the Corporate
\u00a0
Governance section of the Board of Directors\u2019
\u00a0
report).
The average number of labour-years employed in continuing
\u00a0
operations was approximately 14 000 in 2022 and 15 000
\u00a0
in 2021.
\u00a0
Share-based payment program
Employees
\u00a0
and managers
\u00a0
worldwide
\u00a0
are offered
\u00a0
to purchase
\u00a0
Telenor shares
\u00a0
at a discounted
\u00a0
price and
\u00a0
potentially
\u00a0
earn bonus
\u00a0
shares if
\u00a0
the share
price exceeds certain benchmarks in the future.
\u00a0
Bonus shares are awarded net after tax
\u00a0
and Telenor withhold and pay withholding taxes on behalf
of the employee. The share-based payment programs including
\u00a0
the withholding tax are considered as equity-settled share-based
\u00a0
payments, where
the fair
\u00a0
value of
\u00a0
the bonus
\u00a0
shares is
\u00a0
estimated
\u00a0
at the grant
\u00a0
date and
\u00a0
expensed
\u00a0
over the
\u00a0
vesting period.
\u00a0
Social security
\u00a0
taxes are
\u00a0
recognised
\u00a0
as
cash-settled share-based payments measured at fair value
\u00a0
and remeasured at each reporting date.
Accounting policies
Defined contribution plans
A defined contribution plan is a type of
\u00a0
retirement plan where the employer makes contributions on
\u00a0
a regular basis to the employee\u2019s individual
pension account. The benefits received by the
\u00a0
employee are based on the employer contributions and gains
\u00a0
or losses from investing the capital.
Contributions
\u00a0
to defined contribution pension plans are recognised
\u00a0
as an expense in the income statement
\u00a0
as incurred.
Defined benefit plans
A defined benefit plan is a pension plan
\u00a0
where the employer promises an annual pension
\u00a0
on retirement based on a percentage of
\u00a0
the salary upon
retirement and the employee's earnings history, years
\u00a0
of service and age. The pension obligations are
\u00a0
determined by discounting the estimated
future pension
\u00a0
cash outflows
\u00a0
less the
\u00a0
fair value
\u00a0
of plan assets.
\u00a0
The discount
\u00a0
rate is based
\u00a0
on interest
\u00a0
rates of
\u00a0
high-quality
\u00a0
corporate
\u00a0
bonds
denominated in the same currency and with
\u00a0
similar maturity as the related pension obligation. The defined
\u00a0
benefit obligation is calculated annually
by independent
\u00a0
actuaries
\u00a0
using the
\u00a0
projected
\u00a0
unit credit
\u00a0
method.
Current and
\u00a0
past service
\u00a0
cost in
\u00a0
addition
\u00a0
to non-routine
\u00a0
pension settlements,
\u00a0
is presented
\u00a0
as salaries
\u00a0
and personnel
\u00a0
costs, and
\u00a0
the net interest
expense is recognised as financial expense in
\u00a0
the income statement. Remeasurements including actuarial gains and losses and
\u00a0
the return on plan
assets exceeding the discount rate are recognised
\u00a0
in the statement of comprehensive income and
\u00a0
are not subsequently reclassified to the income
statement.
A plan curtailment is when Telenor is committed
\u00a0
to reduce the number of employees in a
\u00a0
plan or change the terms, so the
\u00a0
employees are entitled
to reduced benefits or is no longer
\u00a0
eligible for benefits. Past service cost is recognised in
\u00a0
the income statement on the earlier of
\u00a0
the date of the plan
amendment
\u00a0
or curtailment
\u00a0
or when
\u00a0
the related
\u00a0
restructuring
\u00a0
cost is recognised.
\u00a0
Gains and
\u00a0
losses on
\u00a0
curtailments
\u00a0
form part
\u00a0
of service
\u00a0
cost and
\u00a0
are
presented
\u00a0
as part of
\u00a0
other income
\u00a0
or other expenses
\u00a0
in the income
\u00a0
statement.
\u00a0
Defined benefit multi-employer plans
\u00a0
(such as the AFP arrangement in
\u00a0
Norway) are accounted for as defined contribution
\u00a0
plans when insufficient
information
\u00a0
is available
\u00a0
to calculate
\u00a0
Telenor\u2019s
\u00a0
proportionate
\u00a0
share.
NOTE 22
Provisions and obligations
Telenor makes provisions for legal disputes when they become
\u00a0
probable and the amount can be reliably
estimated. Provisions are also made for asset retirement obligations
\u00a0
representing the removal and restoration
cost for infrastructure operated by Telenor. Other provisions relate to
\u00a0
restructuring costs and various onerous
contracts.
Accounting policies
Provisions such as for asset retirement obligations,
\u00a0
workforce reductions, onerous contracts and legal claims
\u00a0
are recognised when there is a
present legal
\u00a0
or constructive
\u00a0
obligation
\u00a0
as a result
\u00a0
of past events,
\u00a0
it is probable
\u00a0
that an outflow
\u00a0
of resources
\u00a0
will be
\u00a0
required
\u00a0
to settle
\u00a0
the obligation,
and the amount
\u00a0
can be reliably
\u00a0
estimated.
\u00a0
Provisions
\u00a0
are measured
\u00a0
at management\u2019s
\u00a0
best estimate
\u00a0
of the expenditure
\u00a0
required
\u00a0
to settle
\u00a0
the
obligation
\u00a0
at the reporting
\u00a0
date and
\u00a0
are discounted
\u00a0
to present
\u00a0
value. Asset
\u00a0
retirement
\u00a0
obligations
\u00a0
(ARO) primarily
\u00a0
relate to
\u00a0
base stations
\u00a0
and
installed
\u00a0
network and
\u00a0
infrastructure
\u00a0
equipment
\u00a0
in addition
\u00a0
to some buildings,
\u00a0
see note
\u00a0
17. The
\u00a0
net present
\u00a0
value of
\u00a0
the future
\u00a0
ARO is discounted
using a
\u00a0
pre-tax risk-free
\u00a0
rate as risks
\u00a0
are reflected
\u00a0
in the cash
\u00a0
flows. Upon
\u00a0
recognition
\u00a0
of an asset
\u00a0
retirement
\u00a0
obligation,
\u00a0
a corresponding
\u00a0
amount is
recognised
\u00a0
as an increase
\u00a0
of the related
\u00a0
asset within
\u00a0
property,
\u00a0
plant and
\u00a0
equipment
\u00a0
with subsequent
\u00a0
depreciation
\u00a0
over the useful
\u00a0
life of the
\u00a0
asset.
After the initial recognition, an accretion expense
\u00a0
is recognised as finance cost. Any subsequent
\u00a0
adjustments of the asset retirement obligation
from changes
\u00a0
of the removal
\u00a0
costs or discount
\u00a0
rates will
\u00a0
have a corresponding
\u00a0
adjustment
\u00a0
to the carrying
\u00a0
value of
\u00a0
the property,
\u00a0
plant and
equipment.
Key judgments
\u00a0
and estimates
Provisions
\u00a0
are estimated
\u00a0
based on
\u00a0
a number
\u00a0
of assumptions
\u00a0
and are
\u00a0
highly uncertain
\u00a0
in nature.
\u00a0
In particular,
\u00a0
the amounts
\u00a0
related
\u00a0
to legal
\u00a0
disputes
can be significant and the assessment of
\u00a0
probability and the possible outcome include highly
\u00a0
judgmental and complex assessments made by
management. Further, there is significant uncertainty related to
\u00a0
the timing of the asset retirement obligation
\u00a0
to occur, as the removal and
restoration of the sites will occur well into
\u00a0
the future and strategy, technological developments, markets
\u00a0
and other factors may impact the timing.
There is
\u00a0
also significant
\u00a0
uncertainty
\u00a0
related
\u00a0
to the asset
\u00a0
removal cost
\u00a0
due to uncertain
\u00a0
future price
\u00a0
development
\u00a0
and possibility
\u00a0
of negotiations
\u00a0
of
prices for
\u00a0
a large
\u00a0
number of
\u00a0
removals.
\u00a0
Further, there
\u00a0
is potentially
\u00a0
agreements
\u00a0
that relief
\u00a0
Telenor from
\u00a0
its obligations
\u00a0
and also uncertainty
\u00a0
as to
whether the
\u00a0
restoration
\u00a0
actually
\u00a0
will take
\u00a0
place. Due
\u00a0
to these uncertainties,
\u00a0
the actual
\u00a0
costs for
\u00a0
legal claims
\u00a0
and asset
\u00a0
retirement
\u00a0
obligations
\u00a0
may be
significantly
\u00a0
different
\u00a0
that current
\u00a0
estimates.
Non-current provisions
NOK in millions
2022
2021
Provision
\u00a0
for workforce
\u00a0
reductions
\u00a0
and onerous
\u00a0
(loss) contracts
\u00a0
334
195
Asset retirement obligations
\u00a0
6 092
7 526
Other provisions
201
250
Total non-current provisions and obligations as of 31 December
6 627
7 971
Current provisions
NOK in millions
2022
2021
Provisions
\u00a0
for workforce
\u00a0
reduction
\u00a0
and onerous
\u00a0
(loss) contracts
\u00a0
345
416
Asset retirement obligations
\u00a0
13
12
Other provisions
433
468
Total current provisions and obligations as of 31 December
791
896
Development
\u00a0
in provisions
The table below shows the development of
\u00a0
provisions during 2022. Provisions for legal disputes are
\u00a0
mainly recognised as trade and other payables
in the statement
\u00a0
of financial
\u00a0
position.
\u00a0
Provisions
\u00a0
made for
\u00a0
discontinued
\u00a0
operations
\u00a0
are disclosed
\u00a0
in note 12.
NOK in millions
Legal disputes
Asset retirement
obligations
contracts
As of 1 January
3 548
7 538
611
Obligations arising and effects of changes in estimates
\u00a0
during the year
952
(1 056)
729
-
147
-
Amounts utilised
( 102)
( 175)
( 656)
Other changes
\u00a0
and translation
\u00a0
difference
( 793)
18
( 4)
Reclassified
\u00a0
to liabilities
\u00a0
held for
\u00a0
sale
-
( 367)
-
As of 31 December
3 605
6 105
679
The increase in provisions during 2022 includes update of
\u00a0
provisions for regulatory disputes based on available
\u00a0
information from the outcome of
court proceedings in Grameenphone. See further information
\u00a0
in Note 23 Legal disputes and contingencies.
Asset retirement obligations
\u00a0
The reduction
\u00a0
in provisions
\u00a0
in 2022
\u00a0
is a result
\u00a0
of updated
\u00a0
estimates
\u00a0
on timing
\u00a0
before expected
\u00a0
removals
\u00a0
and restorations
\u00a0
are expected
\u00a0
to occur.
\u00a0
Workforce reduction
\u00a0
Provisions for workforce reductions included about 570
\u00a0
employees as of 31 December 2022 compared to
\u00a0
about 650 employees the year before.
Accounting policies
Provisions such as for asset retirement obligations,
\u00a0
workforce reductions, onerous contracts and legal claims
\u00a0
are recognised when there is a
present legal
\u00a0
or constructive
\u00a0
obligation
\u00a0
as a result
\u00a0
of past events,
\u00a0
it is probable
\u00a0
that an outflow
\u00a0
of resources
\u00a0
will be
\u00a0
required
\u00a0
to settle
\u00a0
the obligation,
and the amount
\u00a0
can be reliably
\u00a0
estimated.
\u00a0
Provisions
\u00a0
are measured
\u00a0
at management\u2019s
\u00a0
best estimate
\u00a0
of the expenditure
\u00a0
required
\u00a0
to settle
\u00a0
the
obligation
\u00a0
at the reporting
\u00a0
date and
\u00a0
are discounted
\u00a0
to present
\u00a0
value. Asset
\u00a0
retirement
\u00a0
obligations
\u00a0
(ARO) primarily
\u00a0
relate to
\u00a0
base stations
\u00a0
and
installed
\u00a0
network and
\u00a0
infrastructure
\u00a0
equipment
\u00a0
in addition
\u00a0
to some buildings,
\u00a0
see note
\u00a0
17. The
\u00a0
net present
\u00a0
value of
\u00a0
the future
\u00a0
ARO is discounted
using a
\u00a0
pre-tax risk-free
\u00a0
rate as risks
\u00a0
are reflected
\u00a0
in the cash
\u00a0
flows. Upon
\u00a0
recognition
\u00a0
of an asset
\u00a0
retirement
\u00a0
obligation,
\u00a0
a corresponding
\u00a0
amount is
recognised
\u00a0
as an increase
\u00a0
of the related
\u00a0
asset within
\u00a0
property,
\u00a0
plant and
\u00a0
equipment
\u00a0
with subsequent
\u00a0
depreciation
\u00a0
over the useful
\u00a0
life of the
\u00a0
asset.
After the initial recognition, an accretion expense
\u00a0
is recognised as finance cost. Any subsequent
\u00a0
adjustments of the asset retirement obligation
from changes
\u00a0
of the removal
\u00a0
costs or discount
\u00a0
rates will
\u00a0
have a corresponding
\u00a0
adjustment
\u00a0
to the carrying
\u00a0
value of
\u00a0
the property,
\u00a0
plant and
equipment.
NOTE 23
Legal disputes and contingencies
Telenor is subject to various legal proceedings, disputes and claims including
\u00a0
regulatory discussions related to its
business, licences and investments. Management makes
\u00a0
a provision for legal disputes when an unfavourable
outcome is probable and a reliable estimate can be made. The
\u00a0
most significant legal disputes are summarised in
Accounting policies
Legal disputes
\u00a0
are usually
\u00a0
contingent
\u00a0
in nature,
\u00a0
meaning
\u00a0
the possible
\u00a0
obligation
\u00a0
depends
\u00a0
on future
\u00a0
events outside
\u00a0
the company\u2019s
\u00a0
control,
\u00a0
for
example a court decision. Provisions are made
\u00a0
for legal claims where an unfavorable
\u00a0
outcome is probable and the amount required to
\u00a0
settle the
dispute can be reliably estimated. Provisions are based on
\u00a0
management\u2019s best estimate of the amount required
\u00a0
to settle the obligation discounted
Key judgments
\u00a0
and estimates
There is significant uncertainty related to predicting
\u00a0
the outcome of legal proceedings, disputes and claims. The
\u00a0
potential obligations can represent
significant
\u00a0
amounts, the
\u00a0
disputes
\u00a0
may involve
\u00a0
complex assessments
\u00a0
of contracts
\u00a0
and legislation,
\u00a0
and political
\u00a0
and country
\u00a0
risk is
\u00a0
high in certain
disputes. Due to these uncertainties, the future
\u00a0
actual costs for legal disputes may be
\u00a0
significantly different than current estimates. Management
evaluates the degree of probability of
\u00a0
an unfavourable outcome and the ability to
\u00a0
make a reasonable estimate of the amount
\u00a0
of loss. Unanticipated
events or
\u00a0
changes
\u00a0
in these
\u00a0
factors may
\u00a0
require
\u00a0
management
\u00a0
to accrue
\u00a0
for a matters
\u00a0
that become
\u00a0
probable
\u00a0
or reliable,
\u00a0
or change
\u00a0
a provision
accrued for in a previous reporting period.
Significant
\u00a0
legal proceedings,
\u00a0
claims and
\u00a0
regulatory discussions
Significant legal proceedings, claims and regulatory discussions are
\u00a0
summarised below. Some of the cases include a statement
\u00a0
that a provision has
been made.
\u00a0
Cases that
\u00a0
do not state
\u00a0
that a provision
\u00a0
has been
\u00a0
made either
\u00a0
(a) do not
\u00a0
have a provision
\u00a0
and the matter
\u00a0
is treated
\u00a0
as a contingent
liability; or (b) a provision has been established but
\u00a0
the fact has not been disclosed
\u00a0
as it can seriously prejudice our position.
\u00a0
Disclosing that a
provision
\u00a0
has been
\u00a0
made to the
\u00a0
counterparty
\u00a0
would reveal
\u00a0
the fact that
\u00a0
Telenor
\u00a0
believes
\u00a0
it is probably
\u00a0
that a cash
\u00a0
outflow will
\u00a0
occur and
\u00a0
that that
\u00a0
an
amount can be reliably estimated. While acknowledging the
\u00a0
uncertainties related to these matters, management is
\u00a0
of the opinion that based on the
information currently available, these matters will be
\u00a0
resolved without any material financial adverse effect individually
\u00a0
or in aggregate.
\u00a0
See note 10
for further information about tax claims and
\u00a0
uncertain tax positions.
\u00a0
See note 22 for further information about
\u00a0
development in legal dispute
Grameenphone,
\u00a0
Bangladesh
The Bangladesh Telecommunications Regulatory Commission (BTRC) has
\u00a0
over several years conducted an information system
\u00a0
audit of
Grameenphone for the period 1997 to 2014.
\u00a0
On 2 April 2019, Grameenphone received a demand
\u00a0
notice from BTRC for payment of NOK
\u00a0
8.1 billion to
BTRC (NOK 2.2 billion in principal and NOK
\u00a0
5.9
\u00a0
billion in interest), including some matters pending
\u00a0
in ongoing formal resolution processes (sub-
judice). These claims are unjustified from Telenor\u2019s
\u00a0
and Grameenphone\u2019s position. In addition, BTRC has
\u00a0
unauthorised and erroneously claimed
NOK 3.9 billion,
\u00a0
which mainly
\u00a0
is related
\u00a0
to an already
\u00a0
resolved
\u00a0
matter and
\u00a0
other sub-judice
\u00a0
matters with
\u00a0
the National
\u00a0
Board of
\u00a0
Revenue (NBR).
\u00a0
The
total demand
\u00a0
amounts to
\u00a0
NOK 12.0
\u00a0
billion (the
\u00a0
Demand).
\u00a0
Overall,
\u00a0
the Demand
\u00a0
is based
\u00a0
on allegations
\u00a0
that Grameenphone
\u00a0
has, amongst
\u00a0
other
things, underpaid
\u00a0
various taxes,
\u00a0
such as corporate
\u00a0
taxes, SIM
\u00a0
tax, VAT,
\u00a0
and revenue
\u00a0
share from
\u00a0
its mobile
\u00a0
operation.
\u00a0
The Demand
\u00a0
is comprised
\u00a0
of
claims against 26 line items, of which 22 line items are
\u00a0
related to BTRC matters and no provision
\u00a0
has been recorded based on the Demand
\u00a0
dated 2
April 2019, as such. The other four
\u00a0
line items are related to the NBR matters,
\u00a0
where Telenor and Grameenphone in previous years
\u00a0
have recorded
provisions
\u00a0
based on
\u00a0
an assessment
\u00a0
of the legal
\u00a0
merits of
\u00a0
the claims.
\u00a0
On 22 July
\u00a0
2019, BTRC
\u00a0
imposed
\u00a0
operational
\u00a0
restrictions
\u00a0
on Grameenphone
\u00a0
by stopping
\u00a0
No Objection
\u00a0
Certificates
\u00a0
(NOCs) and
\u00a0
approvals
\u00a0
on import
of products,
\u00a0
services,
\u00a0
and equipment.
\u00a0
Late August
\u00a0
2019, Grameenphone
\u00a0
filed both
\u00a0
a civil case
\u00a0
(title suit)
\u00a0
to the District
\u00a0
Court contesting
\u00a0
the
Demand and
\u00a0
an injunction
\u00a0
application
\u00a0
with a request
\u00a0
to stay the
\u00a0
suspension
\u00a0
of NOCs and
\u00a0
to restrain
\u00a0
BTRC from
\u00a0
taking any
\u00a0
steps in enforcing
\u00a0
the
Demand. The District Court rejected the application
\u00a0
for injunction. Grameenphone appealed before the High
\u00a0
Court Division (HCD) on 17 September
2019. On 17 October 2019, HCD passed
\u00a0
an injunction order restraining BTRC, for a
\u00a0
period of two months, from taking any
\u00a0
steps to realise or enforce
the Demand and suspend NOCs for import
\u00a0
of equipment/software and approvals of tariff/service
\u00a0
packages etc. (the \u201cHCD order\u201d). The HCD order
was appealed by BTRC to the Appellate Division
\u00a0
of the Supreme Court (AD) and on
\u00a0
24 November 2019 the AD decided that
\u00a0
the HCD order shall be
maintained, subject to payment
\u00a0
of NOK 1.9 billion by Grameenphone; otherwise,
\u00a0
the HCD order would stand vacated.
\u00a0
On 20 and 24 February 2020, the AD
\u00a0
ordered the payment of the deposit of
\u00a0
NOK 1.9 billion to BTRC to be
\u00a0
made in two equal instalments within 24
February 2020 and 31 May 2020. Both instalments
\u00a0
were paid before the due dates and recognised
\u00a0
as non-current financial assets (see note 27).
Further, AD directed BTRC to allow Grameenphone
\u00a0
to carry on its business without any
\u00a0
hindrance and fixed the matter on 31
\u00a0
May 2020 for passing
further order.
\u00a0
Due to the
\u00a0
COVID-19 situation
\u00a0
in Bangladesh,
\u00a0
the meeting
\u00a0
was postponed,
\u00a0
and no new
\u00a0
date has
\u00a0
been set.
\u00a0
BTRC has
\u00a0
lifted the
operational
\u00a0
restrictions
\u00a0
on the import
\u00a0
of equipment/software
\u00a0
and approvals
\u00a0
of tariff/service
\u00a0
packages etc.
\u00a0
The original
\u00a0
Title suit,
\u00a0
where the
\u00a0
court is
supposed
\u00a0
to assess
\u00a0
the merits
\u00a0
of the Demand,
\u00a0
is pending
\u00a0
at the District
\u00a0
Court. BTRC
\u00a0
submitted
\u00a0
their response
\u00a0
in the title
\u00a0
suit in District
\u00a0
Court 26
May 2022. The court requested the parties to
\u00a0
respond to the commencement of a possible
\u00a0
mediation process, pursuant to local law.
One of the
\u00a0
claims that
\u00a0
BTRC has
\u00a0
presented
\u00a0
to Grameenphone
\u00a0
in the BTRC-case
\u00a0
is related
\u00a0
to a dispute
\u00a0
as to how
\u00a0
VAT on the
\u00a0
payment of
\u00a0
2G license
fee shall be handled. The dispute is whether VAT
\u00a0
is included in the license fee or excluded
\u00a0
and thereby needs to be added and
\u00a0
paid separately.
\u00a0
The
claim represents an exposure of NOK 0.8
\u00a0
billion, excluding interests and penalty. Grameenphone was
\u00a0
under legal obligation to deduct 15% VAT at
source from the payment to BTRC, however
\u00a0
BTRC stipulated in the License Renewal Guideline
\u00a0
to make payment without any deduction. In
\u00a0
2011 the
mobile operators in Bangladesh challenged the new
\u00a0
guideline before the High Court Division. The
\u00a0
High Court Division has directed
\u00a0
Grameenphone
to pay 100%
\u00a0
of the license
\u00a0
fee to BTRC,
\u00a0
15% VAT
\u00a0
to the NBR
\u00a0
and thereafter
\u00a0
exercise
\u00a0
a rebate
\u00a0
right for
\u00a0
VAT. However,
\u00a0
the rebate
\u00a0
was denied
\u00a0
by NBR
due to BTRC not being VAT registered.
\u00a0
Grameenphone, BTRC and NBR filed appeals against
\u00a0
the verdict before the Appellate Division of the
Supreme Court
\u00a0
(AD) on
\u00a0
various grounds.
\u00a0
The hearing started on 26 July 2022 before
\u00a0
the AD and the verbal judgement was
\u00a0
pronounced on 10 January 2023, disallowing the
\u00a0
appeal of
Grameenphone and allowing the appeals of NBR
\u00a0
(challenging the judgement of Grameenphone\u2019s rebate right).
\u00a0
Moreover, the appeal of BTRC
(challenging the judgement relating to declaring imposition
\u00a0
of Market Competition Factor on Spectrum Assignment
\u00a0
in 2008 as illegal) has been
disposed of, which will be clarified when the
\u00a0
written judgement is available. Upon receiving written judgement,
\u00a0
Grameenphone will take necessary
steps subject for further assessment including the
\u00a0
relevant parts of BTRC audit demands.
Singapore and Bangladesh have entered a Bilateral
\u00a0
Investment Treaty (BIT) and in October 2019,
\u00a0
Telenor Asia Pte Ltd, a Telenor subsidiary
\u00a0
being a
shareholder in Grameenphone and domiciled in Singapore, sent
\u00a0
a notice to the President of Bangladesh
\u00a0
to initiate discussions as a first step in
\u00a0
an
attempt to
\u00a0
resolve issues
\u00a0
arising
\u00a0
from the audit
\u00a0
dispute between
\u00a0
Grameenphone
\u00a0
and BTRC
\u00a0
pursuant
\u00a0
to the procedural
\u00a0
mechanisms
\u00a0
in such BIT.
\u00a0
As set out above, Telenor\u2019s and Grameenphone\u2019s
\u00a0
position is that the BTRC claims are
\u00a0
unjustified. Grameenphone has performed a detailed
assessment and obtained legal advice for each
\u00a0
of the line items in the Demand. The
\u00a0
errors in the BTRC audit-findings,
\u00a0
the unprecedented long
period covered by the audit (more than
\u00a0
20 years backwards), the inclusion of already
\u00a0
settled/resolved items, the erroneous claim on behalf of
\u00a0
third
parties and the inclusion of sub-judice
\u00a0
items in conjunction with the absence of
\u00a0
merit based determination through any solution process,
\u00a0
create
significant
\u00a0
uncertainty
\u00a0
about the
\u00a0
validity
\u00a0
of the demand
\u00a0
and outcome
\u00a0
of the dispute.
SIM tax on replacement SIM cards
The Large Taxpayer Unit-VAT has issued three notices to
\u00a0
Grameenphone claiming SIM tax of in total
\u00a0
NOK 1.4 billion (excl. interest) on the
replacement of SIM cards issued during three time
\u00a0
periods from July 2007 to June 2015. In
\u00a0
2019 and 2020, the VAT Appellate Tribunal gave
decisions
\u00a0
in Grameenphone\u2019s
\u00a0
disfavour
\u00a0
in two of
\u00a0
the three
\u00a0
periods (2007-2011
\u00a0
and July
\u00a0
2012-June
\u00a0
2015), representing
\u00a0
a total demand
\u00a0
of NOK 1.3
billion
\u00a0
(excl. interest).
\u00a0
Grameenphone
\u00a0
has appealed
\u00a0
the decisions
\u00a0
to the High
\u00a0
Court Division
\u00a0
of the Supreme
\u00a0
Court who
\u00a0
passed stay
\u00a0
orders on
\u00a0
these
two decisions
\u00a0
by the Tribunal
\u00a0
until final
\u00a0
adjudication.
Dtac, Thailand
Revenue share and deduction of interconnect expenses in dtac (Thailand)
In January 2021,
\u00a0
the two Thailand\u2019s state-owned telecom
\u00a0
companies TOT Public Company Limited (TOT) and CAT
\u00a0
Telecom Public Company Limited
(CAT) merged and became National Telecom Public
\u00a0
Company Limited (NT). The disputes mentioned below
\u00a0
were initiated prior to the merger, as
disputes
\u00a0
with CAT,
\u00a0
but as a
\u00a0
result of
\u00a0
the merger,
\u00a0
NT is now
\u00a0
dtac\u2019s counterpart
\u00a0
in these
\u00a0
proceedings.
\u00a0
Dtac is
\u00a0
involved
\u00a0
in industry
\u00a0
disputes
\u00a0
with NT related
\u00a0
to the calculation
\u00a0
of revenue
\u00a0
share in
\u00a0
the now
\u00a0
expired
\u00a0
concession.
\u00a0
The issue
\u00a0
of the disputes
\u00a0
is
whether dtac
\u00a0
had the right
\u00a0
to deduct
\u00a0
interconnect
\u00a0
expenses
\u00a0
from its
\u00a0
interconnect
\u00a0
revenues to
\u00a0
be used
\u00a0
as basis
\u00a0
for calculating
\u00a0
the payment
\u00a0
of
concession
\u00a0
fee to NT.
\u00a0
Since late
\u00a0
December
\u00a0
2019, various
\u00a0
arbitration
\u00a0
panels have
\u00a0
made decisions
\u00a0
in dtac\u2019s
\u00a0
favor and
\u00a0
disfavor
\u00a0
for
\u00a0
concession
\u00a0
years
16 to 20.
\u00a0
Pursuant to these awards, dtac
\u00a0
has an obligation to pay an approximate total
\u00a0
amount of NOK 5.3 billion. Dtac has
\u00a0
appealed the negative
awards to
\u00a0
the Central
\u00a0
Administrative
\u00a0
Court. For
\u00a0
the disputes
\u00a0
related
\u00a0
to concession
\u00a0
years 21
\u00a0
to 27 (16
\u00a0
September
\u00a0
2011 to 15
\u00a0
September
\u00a0
2018),
\u00a0
NT has
previously
\u00a0
presented
\u00a0
claims of
\u00a0
NOK 4.5 billion
\u00a0
in total
\u00a0
(excl. penalty
\u00a0
and interest).
\u00a0
During second
\u00a0
quarter 2022,
\u00a0
the Arbitral
\u00a0
Tribunal
\u00a0
allowed NT
\u00a0
to
increase the claimed amount by NOK 0.4 billion,
\u00a0
since interconnect revenues dtac received from other
\u00a0
telecom operators was higher than the
amounts stated
\u00a0
in NT\u2019s statement
\u00a0
of claim.
Revenue share - deduction of excise tax
On 11 January
\u00a0
2008, National
\u00a0
Telecom PCL
\u00a0
(NT) submitted
\u00a0
a claim to
\u00a0
the Arbitration
\u00a0
Institute
\u00a0
in Thailand
\u00a0
requesting
\u00a0
dtac to make
\u00a0
concession
revenue sharing payments for the concession period
\u00a0
16 September 2002 to 15 September 2006 amounting
\u00a0
to NOK 6.6 billion including VAT and
penalties.
\u00a0
The basis
\u00a0
for the claim
\u00a0
is that revenue
\u00a0
share paid
\u00a0
by dtac to
\u00a0
NT was made
\u00a0
after deduction
\u00a0
of excise
\u00a0
tax. Dtac\u2019s
\u00a0
opinion is
\u00a0
that it was
entitled to deduct excise tax pursuant to
\u00a0
resolutions made by the Thai Council of
\u00a0
Ministers on 11 February 2003 and a letter issued
\u00a0
by NT on 27
March 2003. On 28 May 2012, the Thai Arbitral
\u00a0
Tribunal rendered an award in favor of dtac and
\u00a0
dismissed NT's claim. However, on 31 August
\u00a0
2012,
NT filed a lawsuit with the Central Administrative Court
\u00a0
in Thailand in order to revoke the Arbitral
\u00a0
Tribunal's award. On 29 January 2016, dtac was
notified
\u00a0
by the Central
\u00a0
Administrative
\u00a0
Court in
\u00a0
Thailand
\u00a0
that the court
\u00a0
had decided
\u00a0
the case
\u00a0
in dtac's
\u00a0
favor. NT
\u00a0
appealed
\u00a0
the case to
\u00a0
the Supreme
Administrative Court in Thailand. On 10 January 2023,
\u00a0
the Supreme Administrative Court uphold the judgement of
\u00a0
the Administrative Court of First
Instance to dismiss CAT\u2019s statement of claim
\u00a0
to revoke the arbitral award requested. The case
\u00a0
is thereby closed in dtac\u2019s favour.
Foreign ownership
One of dtac's competitors made a number
\u00a0
of complaints to the Thai Police and the Thai
\u00a0
Ministry of Commerce early in 2011, that dtac
\u00a0
is in breach of
the Foreign Business Act (FBA) limiting foreign
\u00a0
ownership to 49% of the share capital
\u00a0
without special governmental permission.
\u00a0
In addition,
\u00a0
on 22 September
\u00a0
2011, one
\u00a0
of dtac's
\u00a0
minority
\u00a0
shareholders
\u00a0
(holding
\u00a0
100 shares
\u00a0
in dtac)
\u00a0
filed a complaint
\u00a0
against the
\u00a0
state agency,
National Broadcasting and Telecommunication Commission (NBTC), with
\u00a0
the Central Administrative Court in Thailand alleging
\u00a0
that NBTC (as an
administrative agency) has negligently failed to perform
\u00a0
its duties in allowing dtac to operate its
\u00a0
telecom business. The Central Administrative
Court in Thailand has issued a summons
\u00a0
requesting dtac to become
\u00a0
a co-defendant in these proceedings. On
\u00a0
26 November 2015, the Central
Administrative
\u00a0
Court in
\u00a0
Thailand
\u00a0
ruled that
\u00a0
the court
\u00a0
cannot revoke
\u00a0
dtac's right
\u00a0
to operate.
\u00a0
However,
\u00a0
the court
\u00a0
has ordered
\u00a0
NBTC to investigate
whether dtac
\u00a0
is in breach
\u00a0
of the FBA.
\u00a0
Both NBTC
\u00a0
and dtac
\u00a0
have filed
\u00a0
an appeal
\u00a0
to the Supreme
\u00a0
Administrative
\u00a0
Court in
\u00a0
Thailand.
Currently, these two cases are under the
\u00a0
consideration of the Royal Thai Police and
\u00a0
the Supreme Administrative Court in Thailand. Telenor believes
that the
\u00a0
ownership structure in dtac was and still
\u00a0
is in accordance with Thai law as well as
\u00a0
established practices in Thailand.
\u00a0
India
Licences and spectrum
Telenor\u2019s
\u00a0
previous
\u00a0
operations
\u00a0
in India
\u00a0
are subject
\u00a0
to a number
\u00a0
of disputes
\u00a0
with the
\u00a0
Indian Department
\u00a0
of Telecommunications
\u00a0
(DoT), which
\u00a0
remain
to be concluded.
\u00a0
Telenor has
\u00a0
provided
\u00a0
guarantees
\u00a0
for certain
\u00a0
claims to
\u00a0
the current
\u00a0
owner Bharti
\u00a0
Airtel. Refer
\u00a0
to note 12
\u00a0
Held for
\u00a0
sale and
discontinued operations for further information about the
\u00a0
guarantee and provisions related to the period Telenor
\u00a0
owned the business in India.
\u00a0
One of the
\u00a0
disputes
\u00a0
relate to
\u00a0
the basis
\u00a0
for calculation
\u00a0
of licence
\u00a0
fees and spectrum
\u00a0
usage charges
\u00a0
for the entire
\u00a0
duration
\u00a0
of Telenor\u2019s
\u00a0
operations
\u00a0
in
India.
\u00a0
DoT has issued several revised and new
\u00a0
demand notices in the mentioned matter against Telenor\u2019s
\u00a0
Indian subsidiaries during the last years. In
a ruling
\u00a0
in the fourth
\u00a0
quarter of
\u00a0
2019 and
\u00a0
in subsequent
\u00a0
court orders
\u00a0
in 2020,
\u00a0
the Supreme
\u00a0
Court of India
\u00a0
upheld DoT\u2019s
\u00a0
view on the
\u00a0
determination
\u00a0
of
the licence fees and spectrum usage. These rulings
\u00a0
have bearing on demands amounting to approximately NOK
\u00a0
3.5 billion. Interest accruals on
demand notices
\u00a0
received
\u00a0
will apply
\u00a0
and are
\u00a0
currently
\u00a0
estimated
\u00a0
to NOK 0.9
\u00a0
billion for
\u00a0
demand notices
\u00a0
covered by
\u00a0
the Supreme
\u00a0
Court orders.
\u00a0
For
demand notices received, not covered by the
\u00a0
Supreme Court orders, there are ongoing reviews
\u00a0
performed by DoT and continued dialog between
Telenor and DoT. Telenor has settled NOK
\u00a0
0.5 billion of the mentioned demands.
\u00a0
On 2 February 2012, the Indian Supreme
\u00a0
Court quashed (cancelled) all 122 2G licences awarded in 2008,
\u00a0
including those granted to Telenor
subsidiary at the time, Unitech Wireless. The
\u00a0
Indian Supreme Court ordered that all such
\u00a0
2G licences and spectrum should be auctioned. The
spectrum auction was completed in November 2012 and Telenor,
\u00a0
through Telewings, secured spectrum licences in 6 circles.
\u00a0
In February 2013, the
Indian Supreme Court ordered the payment of
\u00a0
retroactive spectrum fees for the licences quashed
\u00a0
in February 2012. DoT issued a notice
\u00a0
in
November
\u00a0
2014 to
\u00a0
Unitech Wireless
\u00a0
seeking
\u00a0
an explanation
\u00a0
as to why
\u00a0
retrospective
\u00a0
spectrum
\u00a0
fee payment
\u00a0
should not
\u00a0
be recovered
\u00a0
by DoT
pursuant to the February 2013 order of
\u00a0
the Indian Supreme Court. Telenor replied to the
\u00a0
above notice in December 2014. However, on
\u00a0
14 February
2017,
\u00a0
DoT issued
\u00a0
a demand
\u00a0
notice of
\u00a0
NOK 0.9 billion
\u00a0
(including
\u00a0
interest).
\u00a0
Telenor
\u00a0
has challenged
\u00a0
such demand
\u00a0
and the interpretation
\u00a0
by DoT of
\u00a0
the
Indian Supreme Court judgment before the Telecom
\u00a0
Disputes Settlement and Appellate Tribunal in India.
\u00a0
A stay order is currently in place.
\u00a0
DoT has further
\u00a0
issued a
\u00a0
notice to
\u00a0
8 entities
\u00a0
of Unitech
\u00a0
Wireless
\u00a0
relating
\u00a0
to a financial
\u00a0
penalty of
\u00a0
NOK 1.3 billion
\u00a0
imposed, due
\u00a0
to an alleged
\u00a0
violation
of a merger
\u00a0
approval
\u00a0
for the Unitech
\u00a0
Wireless
\u00a0
entities.
\u00a0
Telenor has
\u00a0
contested
\u00a0
the basis
\u00a0
for the claim.
Telenor Pakistan
Licence renewal
Telenor
\u00a0
Pakistan\u2019s
\u00a0
900 MHz
\u00a0
and 1800
\u00a0
MHz spectrum
\u00a0
licence
\u00a0
expired on
\u00a0
25 May 2019,
\u00a0
and the renewal
\u00a0
fee was
\u00a0
set to NOK
\u00a0
4.0 billion
\u00a0
by the Pakistan
Telecommunication Authority (PTA) for an extension period
\u00a0
of 15 years. Telenor Pakistan disagreed with
\u00a0
the terms and conditions for renewal,
primarily
\u00a0
on the price.
\u00a0
Telenor Pakistan
\u00a0
believed
\u00a0
that the renewal
\u00a0
price should
\u00a0
be NOK 2.5
\u00a0
billion, which
\u00a0
is the same
\u00a0
as for prior
\u00a0
renewals
\u00a0
for other
operators. Accordingly, Telenor Pakistan challenged the terms
\u00a0
and conditions for renewal of said licence in
\u00a0
Islamabad High Court.
\u00a0
On 19 July
\u00a0
2021, the
\u00a0
High Court
\u00a0
decided
\u00a0
the case
\u00a0
in Telenor
\u00a0
Pakistan\u2019s
\u00a0
disfavour.
\u00a0
Telenor
\u00a0
Pakistan
\u00a0
appealed
\u00a0
the case
\u00a0
to the Supreme
\u00a0
Court on 31
August 2021. In December 2021, Telenor Pakistan signed
\u00a0
the licence under protest whilst waiting for the
\u00a0
Supreme Court\u2019s hearing of the case. On
\u00a0
25
May 2022,
\u00a0
the Supreme
\u00a0
Court rejected
\u00a0
the appeal.
\u00a0
The right-of-use
\u00a0
asset and
\u00a0
lease liability
\u00a0
related to
\u00a0
this licence
\u00a0
has been
\u00a0
adjusted
\u00a0
accordingly,
see further information in note 16.
\u00a0
Telenor Pakistan is still waiting for the
\u00a0
written Supreme Court decision and will assess
\u00a0
to file a review petition.
Telenor
\u00a0
Pakistan
\u00a0
has paid
\u00a0
a total of
\u00a0
NOK 2.8 billion
\u00a0
(USD 359
\u00a0
million excl.
\u00a0
interest)
\u00a0
of the demanded
\u00a0
license renewal
\u00a0
fees. See
\u00a0
note 18 for
\u00a0
further
information
\u00a0
about impairment
\u00a0
of Pakistan
\u00a0
following
\u00a0
the Supreme
\u00a0
Court ruling.
ESA
EFTA Surveillance Authority (ESA) and the Norwegian
\u00a0
Competition Authority (NCA) initiated an inspection of
\u00a0
Telenor Norge AS on 4 December 2012
based on
\u00a0
the suspected
\u00a0
abuse of
\u00a0
a dominant
\u00a0
position and/or
\u00a0
anti-competitive
\u00a0
collaboration
\u00a0
in the Norwegian
\u00a0
mobile market.
\u00a0
On 29 June
\u00a0
2020 ESA
issued a
\u00a0
decision
\u00a0
against Telenor
\u00a0
Norway and
\u00a0
Telenor
\u00a0
ASA with
\u00a0
a fine of
\u00a0
NOK 1.2
\u00a0
billion for
\u00a0
abuse of
\u00a0
dominant position
\u00a0
in Norway.
\u00a0
The investigation
has covered
\u00a0
a number
\u00a0
of issues,
\u00a0
but the
\u00a0
final decision
\u00a0
only concerns
\u00a0
the alleged
\u00a0
insufficient
\u00a0
margins between
\u00a0
Telenor\u2019s
\u00a0
wholesale
\u00a0
prices and
prices for
\u00a0
mobile broadband
\u00a0
to residential
\u00a0
customers
\u00a0
when sold
\u00a0
on a stand-alone
\u00a0
basis between
\u00a0
2008 and
\u00a0
2012. The
\u00a0
case rests
\u00a0
on a number
\u00a0
of
legal, economic, and factual considerations, on which
\u00a0
ESA and Telenor have different opinions. Telenor
\u00a0
has paid the fine in accordance with the
obligation
\u00a0
in the decision.
\u00a0
Telenor appealed
\u00a0
the decision
\u00a0
to the EFTA
\u00a0
Court on 28
\u00a0
August 2020.
\u00a0
On 5 May
\u00a0
2022, the
\u00a0
EFTA Court
\u00a0
rejected
\u00a0
Telenor\u2019s
appeal and
\u00a0
the case
\u00a0
is thereby
\u00a0
final and
\u00a0
closed.
Accounting policies
Legal disputes
\u00a0
are usually
\u00a0
contingent
\u00a0
in nature,
\u00a0
meaning
\u00a0
the possible
\u00a0
obligation
\u00a0
depends
\u00a0
on future
\u00a0
events outside
\u00a0
the company\u2019s
\u00a0
control,
\u00a0
for
example a court decision. Provisions are made
\u00a0
for legal claims where an unfavorable
\u00a0
outcome is probable and the amount required to
\u00a0
settle the
dispute can be reliably estimated. Provisions are based on
\u00a0
management\u2019s best estimate of the amount required
\u00a0
to settle the obligation discounted
NOTE 24
Trade and other payables
\u00a0
Accounting policies
Trade and other payables relate to amounts
\u00a0
owed to suppliers and customer contract liabilities
\u00a0
include amounts received from a customer that
exceed the revenue recognised, for example prepaid subscriptions.
\u00a0
Customer contract liabilities are expected to be realised within
\u00a0
in the Group\u2019s
normal operating
\u00a0
cycle and
\u00a0
are classified
\u00a0
as current.
Trade and other
\u00a0
payables
NOK in millions
Category
2022
2021
Trade payables
7 955
9 082
Accruals
12 322
13 530
Total trade payables and accruals as of 31 December
FLAC
1)
20 277
22 612
Contract liabilities
5 013
6 001
Government
\u00a0
taxes, tax
\u00a0
deductions
\u00a0
etc.
2 937
3 707
Total other payables as of 31 December
NF
2)
7 950
9 708
Total trade and other payables as of 31 December
28 227
32 320
1)
FLAC: Financial liabilities at amortised cost.
\u00a0
2)
NF: Non-financial assets and liabilities.
Specification
\u00a0
of customer contract
\u00a0
liabilities
NOK in millions
2022
2021
Balance as of 1 January
6 001
6 785
Revenue recognised that was included in opening balance
(4 677)
(6 063)
New contract
\u00a0
liabilities
\u00a0
less transfer
\u00a0
to revenue
4 646
5 990
Disposal of companies
( 897)
-
Currency
\u00a0
and other
\u00a0
effects
( 59)
( 206)
Reclassified
\u00a0
to liabilities
\u00a0
held for
\u00a0
sale
-
( 505)
Balance as of 31 December
5 013
6 001
Customer contract liabilities comprise Group\u2019s obligation to
\u00a0
transfer services to its customers for which
\u00a0
it has received consideration in advance.
This includes unearned revenue relating to prepaid services,
\u00a0
connection fee not considered to be a
\u00a0
separate performance obligation, and other
contract liabilities.
Accounting policies
Trade and other payables relate to amounts
\u00a0
owed to suppliers and customer contract liabilities
\u00a0
include amounts received from a customer that
exceed the revenue recognised, for example prepaid subscriptions.
\u00a0
Customer contract liabilities are expected to be realised within
\u00a0
in the Group\u2019s
normal operating
\u00a0
cycle and
\u00a0
are classified
\u00a0
as current.
NOTE 25
Contractual commitments
Telenor has entered into agreements with fixed
\u00a0
payments in respect of the following as of 31
\u00a0
December 2022 and as of 31 December 2021.
2022
NOK in millions
2023
2024
2025
2026
2027
After 2027
Contractual purchase obligations
IT-related agreements
246
50
4
-
-
-
Other contractual obligations
4 490
1 164
43
32
32
27
Committed investments
Property plant and equipment and intangible assets
2 242
18
10
10
10
20
Total contractual obligations
6 978
1 233
57
42
42
47
2021
NOK in millions
2022
2023
2024
2025
2026
After 2026
Contractual purchase obligations
IT-related
\u00a0
agreements
329
28
4
-
-
-
Other contractual obligations
5 080
2 018
334
45
13
10
Committed investments
Property plant and equipment and intangible assets
3 621
9
-
-
-
-
Total contractual obligations
9 031
2 055
338
45
13
10
The tables above include agreements under which Telenor
\u00a0
has only committed minimum purchase obligations. The
\u00a0
table for 2021 has been
updated with changes related to other contractual
\u00a0
obligations in Denmark.
NOTE 26
Contract cost and other prepaid costs
Accounting policies
Costs of obtaining customer contracts include commissions
\u00a0
to dealers and costs for fulfilling a
\u00a0
contract include connection and installation of
equipment on customer premises, including direct labour and material
\u00a0
costs. When such costs are incremental and expected
\u00a0
to be recovered, they
are capitalised
\u00a0
as contract
\u00a0
cost assets
\u00a0
and amortised
\u00a0
over the
\u00a0
expected
\u00a0
customer lifetime.
\u00a0
Renewal periods
\u00a0
are included
\u00a0
in the period
\u00a0
based on
historical churn data, unless new costs
\u00a0
are incurred on contract renewals. These costs are
\u00a0
included in EBITDA. The practical expedient of not
capitalising contract costs that would have been
\u00a0
amortised within 12 months has been applied.
Contract costs
\u00a0
and other prepaid
\u00a0
costs
NOK in millions
2022
2021
Contract costs
4 082
4 059
Governmental taxes and duties
127
138
Prepayments
3
217
Total non-current non-financial assets
4 212
4 414
Contract costs
The below
\u00a0
tables set
\u00a0
forth the
\u00a0
costs capitalised
\u00a0
and amortised
\u00a0
during the
\u00a0
year 2022
\u00a0
and 2021:
NOK in millions
As of 31
\u00a0
December
\u00a0
2021
Costs capitalised
Amortisation
- continued
operations
- discontinued
operations
Impairment
- discontinued
operations
Translation
Differences
As of 31
\u00a0
December
\u00a0
2022
Contract acquisition
\u00a0
costs
4 008
2 146
(1 775)
( 174)
9
( 2)
4 041
Contract fulfilment
\u00a0
costs
51
4
( 11)
-
-
( 3)
41
Total contract costs
4 059
2 150
(1 787)
( 174)
9
( 4)
4 082
NOK in millions
As of 31
\u00a0
December
\u00a0
2020
Costs capitalised
Amortisation
- continued
operations
- discontinued
operations
Impairment
- discontinued
operations
Translation
Differences
As of 31
\u00a0
December
\u00a0
2021
Contract acquisition
\u00a0
costs
3 851
2 518
(2 086)
( 173)
-
( 101)
4 008
Contract fulfilment
\u00a0
costs
75
21
( 25)
( 3)
( 12)
( 6)
51
Total contract costs
3 926
2 539
(2 112)
( 176)
( 13)
( 107)
4 059
NOTE 27
Financial assets and non-interest-bearing liabilities
Derivatives such as forward currency contracts and interest rate swaps
\u00a0
are used to mitigate financial risks. Other
financial assets include commercial papers, deposits, lease receivables
\u00a0
and equity investments.
\u00a0
Accounting policies
Financial
\u00a0
assets and
\u00a0
liabilities
A financial instrument is defined as any
\u00a0
contract that gives rise to a financial
\u00a0
asset of one entity and a financial liability or
\u00a0
equity instrument of
another entity. The financial instruments are recognised in
\u00a0
the statement of financial position when Telenor becomes
\u00a0
a party to the contractual
provisions of the instrument, using trade date
\u00a0
accounting. Financial assets and liabilities are offset
\u00a0
when there is intention and legally enforceable
right to
\u00a0
settle the
\u00a0
contracts
\u00a0
net.
Categories
\u00a0
of financial
\u00a0
assets and
\u00a0
liabilities
The categorisation of the financial instrument for
\u00a0
measurement purposes is based on the objective and
\u00a0
the contractual cash flow characteristics
determined at initial recognition. Telenor does not
\u00a0
apply the fair value option.
Telenor has financial assets classified in the following
\u00a0
measurement categories:
\u00a0
\u25cf
FAAC - financial
\u00a0
assets at
\u00a0
amortised
\u00a0
cost. Consist
\u00a0
of financial
\u00a0
assets held
\u00a0
to collect
\u00a0
contractual
\u00a0
cash flows
\u00a0
that are
\u00a0
solely payments
\u00a0
of
principal
\u00a0
and interest.
\u25cf
FVTOCI -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through other
\u00a0
comprehensive
\u00a0
income. Consist
\u00a0
of equity
\u00a0
investments
\u00a0
not held
\u00a0
for trading.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes,
\u00a0
assets held
\u00a0
for
trading
\u00a0
and financial
\u00a0
assets that
\u00a0
are not
\u00a0
classified
\u00a0
in one of
\u00a0
the other
\u00a0
categories.
Telenor has financial liabilities classified in the following
\u00a0
categories:
\u00a0
\u25cf
FLAC - financial
\u00a0
liabilities
\u00a0
at amortised
\u00a0
cost. Consist
\u00a0
of liabilities
\u00a0
that are
\u00a0
not a part
\u00a0
of the category
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
liabilities
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes and
\u00a0
other liabilities
Equity investments include equity instruments and capital contribution
\u00a0
to Telenor Pension Fund. Equity investments not
\u00a0
held for trading are
financial assets with changes in fair value
\u00a0
through other comprehensive income (FVTOCI).
\u00a0
Unrealised gains and losses are reclassified within equity
from other
\u00a0
reserves
\u00a0
to retained
\u00a0
earnings
\u00a0
when the
\u00a0
investment
\u00a0
is disposed.
\u00a0
Equity investments
\u00a0
held for
\u00a0
trading
\u00a0
are financial
\u00a0
assets with
\u00a0
changes in
fair value through profit and loss (FVTPL), and
\u00a0
transaction costs are immediately expensed. Telenor does currently
\u00a0
not have equity instruments held
for trading.
Telenor
\u00a0
uses derivative
\u00a0
financial
\u00a0
instruments
\u00a0
such as forward
\u00a0
currency
\u00a0
contracts,
\u00a0
interest rate
\u00a0
swaps and
\u00a0
cross currency
\u00a0
interest
\u00a0
rate swaps
\u00a0
to
hedge its risks associated with interest rate
\u00a0
and foreign currency fluctuations. The derivative financial instruments are
\u00a0
measured at fair value. Any
gains or
\u00a0
losses arising
\u00a0
from changes
\u00a0
in fair
\u00a0
value on derivatives
\u00a0
that are
\u00a0
not cash flow
\u00a0
hedges or
\u00a0
hedges of
\u00a0
net investments
\u00a0
are recognised
\u00a0
in the
income statement as financial income or expense.
\u00a0
Embedded derivatives
\u00a0
Embedded derivatives are separated from the host
\u00a0
contract and recognised
\u00a0
at fair value, except when the risks and
\u00a0
economic characteristics are
closely
\u00a0
related to
\u00a0
the host contract
\u00a0
and the host
\u00a0
contract
\u00a0
is not carried
\u00a0
at fair value.
\u00a0
The currency
\u00a0
derivative
\u00a0
embedded
\u00a0
in committed
\u00a0
purchase or
sales contracts
\u00a0
are not separated
\u00a0
when the
\u00a0
payment is
\u00a0
in one of
\u00a0
the party\u2019s
\u00a0
functional
\u00a0
currency
\u00a0
or in a commonly
\u00a0
used currency
\u00a0
in the relevant
economic environment. Unrealised gains or losses are
\u00a0
recognised in the income statement.
\u00a0
Other current and non-current financial assets
Financial
\u00a0
assets such
\u00a0
as various
\u00a0
receivables
\u00a0
and deposits
\u00a0
initially
\u00a0
recognised
\u00a0
at fair
\u00a0
value including
\u00a0
directly attributable
\u00a0
transactions
\u00a0
costs and
subsequently measured at amortised cost using the
\u00a0
effective interest rate method. These financial assets
\u00a0
are adjusted for provision for
impairment in accordance with the expected credit loss
\u00a0
model.
\u00a0
Lease receivables
In finance
\u00a0
leases, a
\u00a0
lease receivable
\u00a0
is recognised
\u00a0
based on
\u00a0
future expected
\u00a0
lease payments,
\u00a0
and finance
\u00a0
income is
\u00a0
allocated
\u00a0
using a
\u00a0
constant
periodic
\u00a0
rate of return
\u00a0
over the
\u00a0
lease term.
\u00a0
In a transaction
\u00a0
for which
\u00a0
an underlying
\u00a0
asset is
\u00a0
sub-leased
\u00a0
to a third
\u00a0
party, the
\u00a0
sublease is
\u00a0
classified
\u00a0
as a
finance or
\u00a0
operating
\u00a0
lease by
\u00a0
reference
\u00a0
to the right-of-use
\u00a0
asset arising
\u00a0
from the
\u00a0
head lease.
\u00a0
See note
\u00a0
3 for further
\u00a0
information
\u00a0
about operation
lease revenue.
Supply chain financing agreements
\u00a0
In supply chain financing agreements, the payables are
\u00a0
reclassified from trade payables to current non-interest
\u00a0
bearing liabilities when the
financing arrangements are linked to the payment
\u00a0
terms of the contract with the vendor.
\u00a0
The current liability is presented as
\u00a0
non-interest bearing
as the payment of interest is carried
\u00a0
by the vendor. When the financial institution makes
\u00a0
the payment to the vendor, an operational
\u00a0
cash outflow is
presented
\u00a0
in the Statement
\u00a0
of Cash Flows
\u00a0
if it is
\u00a0
related to
\u00a0
operating
\u00a0
activities
\u00a0
and cash outflow
\u00a0
from investing
\u00a0
activities
\u00a0
if it is related
\u00a0
to investing
activities. At the same time a financial
\u00a0
cash inflow reflecting that a financial liability has
\u00a0
been obtained. The subsequent payment of the financial
liability
\u00a0
is presented as financial cash outflow in
\u00a0
the cash flow statement. Supply chain financing
\u00a0
arrangements that do not have any link
\u00a0
to payment
terms or any
\u00a0
other parts
\u00a0
of the contract
\u00a0
with the
\u00a0
vendor are
\u00a0
classified
\u00a0
as trade
\u00a0
payables.
\u00a0
Cash outflow
\u00a0
from such arrangements
\u00a0
are presented
\u00a0
as
operating
\u00a0
activities
\u00a0
in the Statement
\u00a0
of Cash Flows.
Non-current financial
\u00a0
assets
NOK in millions
4)
Category
2022
2021
Equity investments
3
FVTOCI
1)
937
975
Financial derivatives
2
FVTPL
2)
248
59
Financial derivatives designated for net investment hedge
2
713
27
Other financial
\u00a0
non-current
\u00a0
non-interest-bearing
\u00a0
assets
FAAC
3)
3 066
3 318
Fair value hedge instruments
2
25
927
Other financial
\u00a0
non-current
\u00a0
interest-bearing
\u00a0
assets
FAAC
3)
3 230
970
Finance lease receivable
5)
1 046
1 356
Total non-current financial assets as of 31 December
9 264
7 632
1)
FVTOCI: Fair value through other comprehensive income.
\u00a0
2)
FVTPL: Fair value through profit and loss.
\u00a0
3)
FAAC: Financial assets at amortised cost.
\u00a0
4)
For information about the fair value level of financial
\u00a0
instruments, see note 32.
\u00a0
Equity investments
Equity investments (FVTOCI) include capital contribution to
\u00a0
Telenor Pension Fund of NOK 0.3 billion
\u00a0
and other equity investments of NOK 0.6 billion
(NOK 0.3 billion and NOK 0.7 billion in
\u00a0
2021,
\u00a0
respectively).
Other financial non-current non-interest-bearing assets
Other financial non-current non-interest-bearing
\u00a0
assets as of 31 December 2022 includes
\u00a0
a deposit of NOK 1.9 billion paid to
\u00a0
the Bangladesh
Telecommunication Regulatory Commission (BTRC, see note 23),
\u00a0
long term deposits of NOK 0.3 billion
\u00a0
and other non-current receivables of NOK
0.9 billion
\u00a0
(NOK 2.0
\u00a0
billion, NOK
\u00a0
0.6 billion
\u00a0
and of NOK
\u00a0
0.7 billion
\u00a0
in 2021,
\u00a0
respectively).
Other financial non-current interest-bearing
\u00a0
assets
Other financial
\u00a0
non-current
\u00a0
interest-bearing
\u00a0
assets includes
\u00a0
a receivable
\u00a0
against the
\u00a0
Norwegian
\u00a0
tax authorities
\u00a0
of NOK 2.7
\u00a0
billion related
\u00a0
to the
ongoing court
\u00a0
case for
\u00a0
losses on
\u00a0
receivables
\u00a0
on the Indian
\u00a0
subsidiary
\u00a0
Unitech Wireless
\u00a0
after having
\u00a0
repaid, as
\u00a0
guarantor,
\u00a0
all Unitech
\u00a0
Wireless\u2019
interest-bearing borrowings.
\u00a0
In 2019, Telenor paid an amount of
\u00a0
NOK 2.7 billion after an unfavourable decision by
\u00a0
the Norwegian tax authorities. In
March 2022, Telenor received a favourable verdict
\u00a0
and reversed the tax expense accordingly, see note 10.
Finance
\u00a0
lease receivables
Telenor has recognised receivables at present value
\u00a0
of future lease payments to be received in
\u00a0
lease arrangements where Telenor has transferred
substantially
\u00a0
all the risks
\u00a0
and rewards
\u00a0
incidental
\u00a0
to ownership
\u00a0
of the underlying
\u00a0
assets to
\u00a0
the lessee.
\u00a0
Current finance
\u00a0
lease receivables
\u00a0
are included
in Trade and other receivables (see note 19).
2022
2021
NOK in millions
Current
Non-current
Total
Current
Non-current
Total
Sublease of land
361
973
1 334
329
1 203
1 533
Lease of satellite
97
72
169
94
153
247
Total finance
\u00a0
lease receivables
458
1 046
1 504
423
1 356
1 779
During 2022, the Group recognised interest income
\u00a0
of NOK 60 million (NOK 73 million
\u00a0
in 2021) (note 9) related to finance lease receivables.
Dtac has Tower Service Agreement with the National
\u00a0
Telecom Public Company Limited (NT) and under the agreement,
\u00a0
dtac transferred towers that
dtac procured
\u00a0
under the
\u00a0
concession
\u00a0
agreement
\u00a0
to operate
\u00a0
and to provide
\u00a0
cellular
\u00a0
telephonic
\u00a0
service and
\u00a0
entered into
\u00a0
lease agreement
\u00a0
to use the
towers. The right to use towers from
\u00a0
NT was recognised as right-of-use asset with
\u00a0
corresponding lease liability. Under the agreement, dtac
\u00a0
shall
itself have lease agreements for the land
\u00a0
with landowners and shall receive compensation from NT
\u00a0
for this. dtac recognised lease agreements as a
lessee with
\u00a0
the landowners
\u00a0
for the land
\u00a0
related to
\u00a0
transferred
\u00a0
towers to
\u00a0
NT with
\u00a0
related lease
\u00a0
liabilities.
\u00a0
Right-of-use
\u00a0
assets related
\u00a0
to land was
derecognised on 1 January 2019 based on the
\u00a0
sublease arrangement with NT and a finance lease
\u00a0
receivable was recognised with reference to the
tenure of the agreement with NT.
\u00a0
The Group
\u00a0
entered into
\u00a0
a long-term
\u00a0
lease with
\u00a0
UPC on 1
\u00a0
April 2017
\u00a0
for the lease
\u00a0
of 9 transponders
\u00a0
on Thor
\u00a0
6, where
\u00a0
the final
\u00a0
payment from
\u00a0
UPC will
be made in
\u00a0
January 2025.
\u00a0
According
\u00a0
to the agreement,
\u00a0
substantially
\u00a0
all the risks
\u00a0
and rewards
\u00a0
related
\u00a0
to Thor 6
\u00a0
are transferred
\u00a0
to UPC, and
accordingly a finance lease receivable was recognised at present
\u00a0
value, which represents the deferred payments to
\u00a0
be received until January 2025.
\u00a0
The following
\u00a0
table sets
\u00a0
forth the
\u00a0
maturity
\u00a0
analysis
\u00a0
of lease
\u00a0
receivables:
NOK in millions
2022
2021
506
438
1 to 2 years
445
449
2 to 3 years
384
415
3 to 4 years
272
360
4 to 5 years
-
269
After 5 years
-
-
Total undiscounted lease payments receivable
1 607
1 931
Unearned
\u00a0
interest income
( 103)
( 152)
Net investment in leases
1 504
1 779
Current financial
\u00a0
assets
NOK in millions
3)
Category
2022
2021
Assets held
\u00a0
for trading
2
FVTPL
1)
50
48
Bonds and commercial papers > 3 months
FAAC
2)
277
327
Financial derivatives
\u00a0
2
FVTPL
1)
29
1
Financial derivatives designated for net investment hedge
2
2
320
Fair value hedge instruments
2
2
143
Total other current financial assets as of 31 December
361
839
Non-current
\u00a0
non-interest-bearing
\u00a0
liabilities
NOK in millions
3)
Category
2022
2021
Financial derivatives
\u00a0
2
FVTPL
1)
149
156
Financial derivatives designated for net investment hedge
2
1 306
950
Other non-current non-interest-bearing
\u00a0
liabilities
FLAC
2)
317
282
Total non-current non-interest-bearing
\u00a0
liabilities as of 31 December
1 772
1 388
Current non-interest-bearing
\u00a0
liabilities
NOK in millions
3)
Category
2022
2021
Financial derivatives
\u00a0
2
FVTPL
1)
3
6
Financial derivatives designated for net investment hedge
2
382
669
Other current non-interest-bearing
\u00a0
liabilities
FLAC
2)
1 308
1 294
Total current non-interest-bearing
\u00a0
liabilities as of 31 December
1 694
1 969
1)
FVTPL: Fair value through profit and loss.
2)
FLAC: Financial liabilities at amortised cost.
3)
For information about the fair value level of financial
\u00a0
instruments, see note 32.
Other current non-interest-bearing
\u00a0
liabilities include liabilities to financing institutions under supply
\u00a0
chain financing programs of NOK 616 million as
of 31 December 2022 (NOK 596 million as
\u00a0
of 31 December 2021).
NOTE 26
Contract cost and other prepaid costs
Accounting policies
Costs of obtaining customer contracts include commissions
\u00a0
to dealers and costs for fulfilling a
\u00a0
contract include connection and installation of
equipment on customer premises, including direct labour and material
\u00a0
costs. When such costs are incremental and expected
\u00a0
to be recovered, they
are capitalised
\u00a0
as contract
\u00a0
cost assets
\u00a0
and amortised
\u00a0
over the
\u00a0
expected
\u00a0
customer lifetime.
\u00a0
Renewal periods
\u00a0
are included
\u00a0
in the period
\u00a0
based on
historical churn data, unless new costs
\u00a0
are incurred on contract renewals. These costs are
\u00a0
included in EBITDA. The practical expedient of not
capitalising contract costs that would have been
\u00a0
amortised within 12 months has been applied.
Contract costs
\u00a0
and other prepaid
\u00a0
costs
NOK in millions
2022
2021
Contract costs
4 082
4 059
Governmental taxes and duties
127
138
Prepayments
3
217
Total non-current non-financial assets
4 212
4 414
Contract costs
The below
\u00a0
tables set
\u00a0
forth the
\u00a0
costs capitalised
\u00a0
and amortised
\u00a0
during the
\u00a0
year 2022
\u00a0
and 2021:
NOK in millions
As of 31
\u00a0
December
\u00a0
2021
Costs capitalised
Amortisation
- continued
operations
- discontinued
operations
Impairment
- discontinued
operations
Translation
Differences
As of 31
\u00a0
December
\u00a0
2022
Contract acquisition
\u00a0
costs
4 008
2 146
(1 775)
( 174)
9
( 2)
4 041
Contract fulfilment
\u00a0
costs
51
4
( 11)
-
-
( 3)
41
Total contract costs
4 059
2 150
(1 787)
( 174)
9
( 4)
4 082
NOK in millions
As of 31
\u00a0
December
\u00a0
2020
Costs capitalised
Amortisation
- continued
operations
- discontinued
operations
Impairment
- discontinued
operations
Translation
Differences
As of 31
\u00a0
December
\u00a0
2021
Contract acquisition
\u00a0
costs
3 851
2 518
(2 086)
( 173)
-
( 101)
4 008
Contract fulfilment
\u00a0
costs
75
21
( 25)
( 3)
( 12)
( 6)
51
Total contract costs
3 926
2 539
(2 112)
( 176)
( 13)
( 107)
4 059
NOTE 26
Contract cost and other prepaid costs
Accounting policies
Costs of obtaining customer contracts include commissions
\u00a0
to dealers and costs for fulfilling a
\u00a0
contract include connection and installation of
equipment on customer premises, including direct labour and material
\u00a0
costs. When such costs are incremental and expected
\u00a0
to be recovered, they
are capitalised
\u00a0
as contract
\u00a0
cost assets
\u00a0
and amortised
\u00a0
over the
\u00a0
expected
\u00a0
customer lifetime.
\u00a0
Renewal periods
\u00a0
are included
\u00a0
in the period
\u00a0
based on
historical churn data, unless new costs
\u00a0
are incurred on contract renewals. These costs are
\u00a0
included in EBITDA. The practical expedient of not
capitalising contract costs that would have been
\u00a0
amortised within 12 months has been applied.
Contract costs
\u00a0
and other prepaid
\u00a0
costs
NOK in millions
2022
2021
Contract costs
4 082
4 059
Governmental taxes and duties
127
138
Prepayments
3
217
Total non-current non-financial assets
4 212
4 414
Contract costs
The below
\u00a0
tables set
\u00a0
forth the
\u00a0
costs capitalised
\u00a0
and amortised
\u00a0
during the
\u00a0
year 2022
\u00a0
and 2021:
NOK in millions
As of 31
\u00a0
December
\u00a0
2021
Costs capitalised
Amortisation
- continued
operations
- discontinued
operations
Impairment
- discontinued
operations
Translation
Differences
As of 31
\u00a0
December
\u00a0
2022
Contract acquisition
\u00a0
costs
4 008
2 146
(1 775)
( 174)
9
( 2)
4 041
Contract fulfilment
\u00a0
costs
51
4
( 11)
-
-
( 3)
41
Total contract costs
4 059
2 150
(1 787)
( 174)
9
( 4)
4 082
NOK in millions
As of 31
\u00a0
December
\u00a0
2020
Costs capitalised
Amortisation
- continued
operations
- discontinued
operations
Impairment
- discontinued
operations
Translation
Differences
As of 31
\u00a0
December
\u00a0
2021
Contract acquisition
\u00a0
costs
3 851
2 518
(2 086)
( 173)
-
( 101)
4 008
Contract fulfilment
\u00a0
costs
75
21
( 25)
( 3)
( 12)
( 6)
51
Total contract costs
3 926
2 539
(2 112)
( 176)
( 13)
( 107)
4 059
NOTE 27
Financial assets and non-interest-bearing liabilities
Derivatives such as forward currency contracts and interest rate swaps
\u00a0
are used to mitigate financial risks. Other
financial assets include commercial papers, deposits, lease receivables
\u00a0
and equity investments.
\u00a0
Accounting policies
Financial
\u00a0
assets and
\u00a0
liabilities
A financial instrument is defined as any
\u00a0
contract that gives rise to a financial
\u00a0
asset of one entity and a financial liability or
\u00a0
equity instrument of
another entity. The financial instruments are recognised in
\u00a0
the statement of financial position when Telenor becomes
\u00a0
a party to the contractual
provisions of the instrument, using trade date
\u00a0
accounting. Financial assets and liabilities are offset
\u00a0
when there is intention and legally enforceable
right to
\u00a0
settle the
\u00a0
contracts
\u00a0
net.
Categories
\u00a0
of financial
\u00a0
assets and
\u00a0
liabilities
The categorisation of the financial instrument for
\u00a0
measurement purposes is based on the objective and
\u00a0
the contractual cash flow characteristics
determined at initial recognition. Telenor does not
\u00a0
apply the fair value option.
Telenor has financial assets classified in the following
\u00a0
measurement categories:
\u00a0
\u25cf
FAAC - financial
\u00a0
assets at
\u00a0
amortised
\u00a0
cost. Consist
\u00a0
of financial
\u00a0
assets held
\u00a0
to collect
\u00a0
contractual
\u00a0
cash flows
\u00a0
that are
\u00a0
solely payments
\u00a0
of
principal
\u00a0
and interest.
\u25cf
FVTOCI -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through other
\u00a0
comprehensive
\u00a0
income. Consist
\u00a0
of equity
\u00a0
investments
\u00a0
not held
\u00a0
for trading.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes,
\u00a0
assets held
\u00a0
for
trading
\u00a0
and financial
\u00a0
assets that
\u00a0
are not
\u00a0
classified
\u00a0
in one of
\u00a0
the other
\u00a0
categories.
Telenor has financial liabilities classified in the following
\u00a0
categories:
\u00a0
\u25cf
FLAC - financial
\u00a0
liabilities
\u00a0
at amortised
\u00a0
cost. Consist
\u00a0
of liabilities
\u00a0
that are
\u00a0
not a part
\u00a0
of the category
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
liabilities
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes and
\u00a0
other liabilities
Equity investments include equity instruments and capital contribution
\u00a0
to Telenor Pension Fund. Equity investments not
\u00a0
held for trading are
financial assets with changes in fair value
\u00a0
through other comprehensive income (FVTOCI).
\u00a0
Unrealised gains and losses are reclassified within equity
from other
\u00a0
reserves
\u00a0
to retained
\u00a0
earnings
\u00a0
when the
\u00a0
investment
\u00a0
is disposed.
\u00a0
Equity investments
\u00a0
held for
\u00a0
trading
\u00a0
are financial
\u00a0
assets with
\u00a0
changes in
fair value through profit and loss (FVTPL), and
\u00a0
transaction costs are immediately expensed. Telenor does currently
\u00a0
not have equity instruments held
for trading.
Telenor
\u00a0
uses derivative
\u00a0
financial
\u00a0
instruments
\u00a0
such as forward
\u00a0
currency
\u00a0
contracts,
\u00a0
interest rate
\u00a0
swaps and
\u00a0
cross currency
\u00a0
interest
\u00a0
rate swaps
\u00a0
to
hedge its risks associated with interest rate
\u00a0
and foreign currency fluctuations. The derivative financial instruments are
\u00a0
measured at fair value. Any
gains or
\u00a0
losses arising
\u00a0
from changes
\u00a0
in fair
\u00a0
value on derivatives
\u00a0
that are
\u00a0
not cash flow
\u00a0
hedges or
\u00a0
hedges of
\u00a0
net investments
\u00a0
are recognised
\u00a0
in the
income statement as financial income or expense.
\u00a0
Embedded derivatives
\u00a0
Embedded derivatives are separated from the host
\u00a0
contract and recognised
\u00a0
at fair value, except when the risks and
\u00a0
economic characteristics are
closely
\u00a0
related to
\u00a0
the host contract
\u00a0
and the host
\u00a0
contract
\u00a0
is not carried
\u00a0
at fair value.
\u00a0
The currency
\u00a0
derivative
\u00a0
embedded
\u00a0
in committed
\u00a0
purchase or
sales contracts
\u00a0
are not separated
\u00a0
when the
\u00a0
payment is
\u00a0
in one of
\u00a0
the party\u2019s
\u00a0
functional
\u00a0
currency
\u00a0
or in a commonly
\u00a0
used currency
\u00a0
in the relevant
economic environment. Unrealised gains or losses are
\u00a0
recognised in the income statement.
\u00a0
Other current and non-current financial assets
Financial
\u00a0
assets such
\u00a0
as various
\u00a0
receivables
\u00a0
and deposits
\u00a0
initially
\u00a0
recognised
\u00a0
at fair
\u00a0
value including
\u00a0
directly attributable
\u00a0
transactions
\u00a0
costs and
subsequently measured at amortised cost using the
\u00a0
effective interest rate method. These financial assets
\u00a0
are adjusted for provision for
impairment in accordance with the expected credit loss
\u00a0
model.
\u00a0
Lease receivables
In finance
\u00a0
leases, a
\u00a0
lease receivable
\u00a0
is recognised
\u00a0
based on
\u00a0
future expected
\u00a0
lease payments,
\u00a0
and finance
\u00a0
income is
\u00a0
allocated
\u00a0
using a
\u00a0
constant
periodic
\u00a0
rate of return
\u00a0
over the
\u00a0
lease term.
\u00a0
In a transaction
\u00a0
for which
\u00a0
an underlying
\u00a0
asset is
\u00a0
sub-leased
\u00a0
to a third
\u00a0
party, the
\u00a0
sublease is
\u00a0
classified
\u00a0
as a
finance or
\u00a0
operating
\u00a0
lease by
\u00a0
reference
\u00a0
to the right-of-use
\u00a0
asset arising
\u00a0
from the
\u00a0
head lease.
\u00a0
See note
\u00a0
3 for further
\u00a0
information
\u00a0
about operation
lease revenue.
Supply chain financing agreements
\u00a0
In supply chain financing agreements, the payables are
\u00a0
reclassified from trade payables to current non-interest
\u00a0
bearing liabilities when the
financing arrangements are linked to the payment
\u00a0
terms of the contract with the vendor.
\u00a0
The current liability is presented as
\u00a0
non-interest bearing
as the payment of interest is carried
\u00a0
by the vendor. When the financial institution makes
\u00a0
the payment to the vendor, an operational
\u00a0
cash outflow is
presented
\u00a0
in the Statement
\u00a0
of Cash Flows
\u00a0
if it is
\u00a0
related to
\u00a0
operating
\u00a0
activities
\u00a0
and cash outflow
\u00a0
from investing
\u00a0
activities
\u00a0
if it is related
\u00a0
to investing
activities. At the same time a financial
\u00a0
cash inflow reflecting that a financial liability has
\u00a0
been obtained. The subsequent payment of the financial
liability
\u00a0
is presented as financial cash outflow in
\u00a0
the cash flow statement. Supply chain financing
\u00a0
arrangements that do not have any link
\u00a0
to payment
terms or any
\u00a0
other parts
\u00a0
of the contract
\u00a0
with the
\u00a0
vendor are
\u00a0
classified
\u00a0
as trade
\u00a0
payables.
\u00a0
Cash outflow
\u00a0
from such arrangements
\u00a0
are presented
\u00a0
as
operating
\u00a0
activities
\u00a0
in the Statement
\u00a0
of Cash Flows.
Non-current financial
\u00a0
assets
NOK in millions
4)
Category
2022
2021
Equity investments
3
FVTOCI
1)
937
975
Financial derivatives
2
FVTPL
2)
248
59
Financial derivatives designated for net investment hedge
2
713
27
Other financial
\u00a0
non-current
\u00a0
non-interest-bearing
\u00a0
assets
FAAC
3)
3 066
3 318
Fair value hedge instruments
2
25
927
Other financial
\u00a0
non-current
\u00a0
interest-bearing
\u00a0
assets
FAAC
3)
3 230
970
Finance lease receivable
5)
1 046
1 356
Total non-current financial assets as of 31 December
9 264
7 632
1)
FVTOCI: Fair value through other comprehensive income.
\u00a0
2)
FVTPL: Fair value through profit and loss.
\u00a0
3)
FAAC: Financial assets at amortised cost.
\u00a0
4)
For information about the fair value level of financial
\u00a0
instruments, see note 32.
\u00a0
Equity investments
Equity investments (FVTOCI) include capital contribution to
\u00a0
Telenor Pension Fund of NOK 0.3 billion
\u00a0
and other equity investments of NOK 0.6 billion
(NOK 0.3 billion and NOK 0.7 billion in
\u00a0
2021,
\u00a0
respectively).
Other financial non-current non-interest-bearing assets
Other financial non-current non-interest-bearing
\u00a0
assets as of 31 December 2022 includes
\u00a0
a deposit of NOK 1.9 billion paid to
\u00a0
the Bangladesh
Telecommunication Regulatory Commission (BTRC, see note 23),
\u00a0
long term deposits of NOK 0.3 billion
\u00a0
and other non-current receivables of NOK
0.9 billion
\u00a0
(NOK 2.0
\u00a0
billion, NOK
\u00a0
0.6 billion
\u00a0
and of NOK
\u00a0
0.7 billion
\u00a0
in 2021,
\u00a0
respectively).
Other financial non-current interest-bearing
\u00a0
assets
Other financial
\u00a0
non-current
\u00a0
interest-bearing
\u00a0
assets includes
\u00a0
a receivable
\u00a0
against the
\u00a0
Norwegian
\u00a0
tax authorities
\u00a0
of NOK 2.7
\u00a0
billion related
\u00a0
to the
ongoing court
\u00a0
case for
\u00a0
losses on
\u00a0
receivables
\u00a0
on the Indian
\u00a0
subsidiary
\u00a0
Unitech Wireless
\u00a0
after having
\u00a0
repaid, as
\u00a0
guarantor,
\u00a0
all Unitech
\u00a0
Wireless\u2019
interest-bearing borrowings.
\u00a0
In 2019, Telenor paid an amount of
\u00a0
NOK 2.7 billion after an unfavourable decision by
\u00a0
the Norwegian tax authorities. In
March 2022, Telenor received a favourable verdict
\u00a0
and reversed the tax expense accordingly, see note 10.
Finance
\u00a0
lease receivables
Telenor has recognised receivables at present value
\u00a0
of future lease payments to be received in
\u00a0
lease arrangements where Telenor has transferred
substantially
\u00a0
all the risks
\u00a0
and rewards
\u00a0
incidental
\u00a0
to ownership
\u00a0
of the underlying
\u00a0
assets to
\u00a0
the lessee.
\u00a0
Current finance
\u00a0
lease receivables
\u00a0
are included
in Trade and other receivables (see note 19).
2022
2021
NOK in millions
Current
Non-current
Total
Current
Non-current
Total
Sublease of land
361
973
1 334
329
1 203
1 533
Lease of satellite
97
72
169
94
153
247
Total finance
\u00a0
lease receivables
458
1 046
1 504
423
1 356
1 779
During 2022, the Group recognised interest income
\u00a0
of NOK 60 million (NOK 73 million
\u00a0
in 2021) (note 9) related to finance lease receivables.
Dtac has Tower Service Agreement with the National
\u00a0
Telecom Public Company Limited (NT) and under the agreement,
\u00a0
dtac transferred towers that
dtac procured
\u00a0
under the
\u00a0
concession
\u00a0
agreement
\u00a0
to operate
\u00a0
and to provide
\u00a0
cellular
\u00a0
telephonic
\u00a0
service and
\u00a0
entered into
\u00a0
lease agreement
\u00a0
to use the
towers. The right to use towers from
\u00a0
NT was recognised as right-of-use asset with
\u00a0
corresponding lease liability. Under the agreement, dtac
\u00a0
shall
itself have lease agreements for the land
\u00a0
with landowners and shall receive compensation from NT
\u00a0
for this. dtac recognised lease agreements as a
lessee with
\u00a0
the landowners
\u00a0
for the land
\u00a0
related to
\u00a0
transferred
\u00a0
towers to
\u00a0
NT with
\u00a0
related lease
\u00a0
liabilities.
\u00a0
Right-of-use
\u00a0
assets related
\u00a0
to land was
derecognised on 1 January 2019 based on the
\u00a0
sublease arrangement with NT and a finance lease
\u00a0
receivable was recognised with reference to the
tenure of the agreement with NT.
\u00a0
The Group
\u00a0
entered into
\u00a0
a long-term
\u00a0
lease with
\u00a0
UPC on 1
\u00a0
April 2017
\u00a0
for the lease
\u00a0
of 9 transponders
\u00a0
on Thor
\u00a0
6, where
\u00a0
the final
\u00a0
payment from
\u00a0
UPC will
be made in
\u00a0
January 2025.
\u00a0
According
\u00a0
to the agreement,
\u00a0
substantially
\u00a0
all the risks
\u00a0
and rewards
\u00a0
related
\u00a0
to Thor 6
\u00a0
are transferred
\u00a0
to UPC, and
accordingly a finance lease receivable was recognised at present
\u00a0
value, which represents the deferred payments to
\u00a0
be received until January 2025.
\u00a0
The following
\u00a0
table sets
\u00a0
forth the
\u00a0
maturity
\u00a0
analysis
\u00a0
of lease
\u00a0
receivables:
NOK in millions
2022
2021
506
438
1 to 2 years
445
449
2 to 3 years
384
415
3 to 4 years
272
360
4 to 5 years
-
269
After 5 years
-
-
Total undiscounted lease payments receivable
1 607
1 931
Unearned
\u00a0
interest income
( 103)
( 152)
Net investment in leases
1 504
1 779
Current financial
\u00a0
assets
NOK in millions
3)
Category
2022
2021
Assets held
\u00a0
for trading
2
FVTPL
1)
50
48
Bonds and commercial papers > 3 months
FAAC
2)
277
327
Financial derivatives
\u00a0
2
FVTPL
1)
29
1
Financial derivatives designated for net investment hedge
2
2
320
Fair value hedge instruments
2
2
143
Total other current financial assets as of 31 December
361
839
Non-current
\u00a0
non-interest-bearing
\u00a0
liabilities
NOK in millions
3)
Category
2022
2021
Financial derivatives
\u00a0
2
FVTPL
1)
149
156
Financial derivatives designated for net investment hedge
2
1 306
950
Other non-current non-interest-bearing
\u00a0
liabilities
FLAC
2)
317
282
Total non-current non-interest-bearing
\u00a0
liabilities as of 31 December
1 772
1 388
Current non-interest-bearing
\u00a0
liabilities
NOK in millions
3)
Category
2022
2021
Financial derivatives
\u00a0
2
FVTPL
1)
3
6
Financial derivatives designated for net investment hedge
2
382
669
Other current non-interest-bearing
\u00a0
liabilities
FLAC
2)
1 308
1 294
Total current non-interest-bearing
\u00a0
liabilities as of 31 December
1 694
1 969
1)
FVTPL: Fair value through profit and loss.
2)
FLAC: Financial liabilities at amortised cost.
3)
For information about the fair value level of financial
\u00a0
instruments, see note 32.
Other current non-interest-bearing
\u00a0
liabilities include liabilities to financing institutions under supply
\u00a0
chain financing programs of NOK 616 million as
of 31 December 2022 (NOK 596 million as
\u00a0
of 31 December 2021).
Accounting policies
Costs of obtaining customer contracts include commissions
\u00a0
to dealers and costs for fulfilling a
\u00a0
contract include connection and installation of
equipment on customer premises, including direct labour and material
\u00a0
costs. When such costs are incremental and expected
\u00a0
to be recovered, they
are capitalised
\u00a0
as contract
\u00a0
cost assets
\u00a0
and amortised
\u00a0
over the
\u00a0
expected
\u00a0
customer lifetime.
\u00a0
Renewal periods
\u00a0
are included
\u00a0
in the period
\u00a0
based on
historical churn data, unless new costs
\u00a0
are incurred on contract renewals. These costs are
\u00a0
included in EBITDA. The practical expedient of not
capitalising contract costs that would have been
\u00a0
amortised within 12 months has been applied.
Accounting policies
Costs of obtaining customer contracts include commissions
\u00a0
to dealers and costs for fulfilling a
\u00a0
contract include connection and installation of
equipment on customer premises, including direct labour and material
\u00a0
costs. When such costs are incremental and expected
\u00a0
to be recovered, they
are capitalised
\u00a0
as contract
\u00a0
cost assets
\u00a0
and amortised
\u00a0
over the
\u00a0
expected
\u00a0
customer lifetime.
\u00a0
Renewal periods
\u00a0
are included
\u00a0
in the period
\u00a0
based on
historical churn data, unless new costs
\u00a0
are incurred on contract renewals. These costs are
\u00a0
included in EBITDA. The practical expedient of not
capitalising contract costs that would have been
\u00a0
amortised within 12 months has been applied.
Accounting policies
Financial
\u00a0
assets and
\u00a0
liabilities
A financial instrument is defined as any
\u00a0
contract that gives rise to a financial
\u00a0
asset of one entity and a financial liability or
\u00a0
equity instrument of
another entity. The financial instruments are recognised in
\u00a0
the statement of financial position when Telenor becomes
\u00a0
a party to the contractual
provisions of the instrument, using trade date
\u00a0
accounting. Financial assets and liabilities are offset
\u00a0
when there is intention and legally enforceable
right to
\u00a0
settle the
\u00a0
contracts
\u00a0
net.
Categories
\u00a0
of financial
\u00a0
assets and
\u00a0
liabilities
The categorisation of the financial instrument for
\u00a0
measurement purposes is based on the objective and
\u00a0
the contractual cash flow characteristics
determined at initial recognition. Telenor does not
\u00a0
apply the fair value option.
Telenor has financial assets classified in the following
\u00a0
measurement categories:
\u00a0
\u25cf
FAAC - financial
\u00a0
assets at
\u00a0
amortised
\u00a0
cost. Consist
\u00a0
of financial
\u00a0
assets held
\u00a0
to collect
\u00a0
contractual
\u00a0
cash flows
\u00a0
that are
\u00a0
solely payments
\u00a0
of
principal
\u00a0
and interest.
\u25cf
FVTOCI -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through other
\u00a0
comprehensive
\u00a0
income. Consist
\u00a0
of equity
\u00a0
investments
\u00a0
not held
\u00a0
for trading.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes,
\u00a0
assets held
\u00a0
for
trading
\u00a0
and financial
\u00a0
assets that
\u00a0
are not
\u00a0
classified
\u00a0
in one of
\u00a0
the other
\u00a0
categories.
Telenor has financial liabilities classified in the following
\u00a0
categories:
\u00a0
\u25cf
FLAC - financial
\u00a0
liabilities
\u00a0
at amortised
\u00a0
cost. Consist
\u00a0
of liabilities
\u00a0
that are
\u00a0
not a part
\u00a0
of the category
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
liabilities
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes and
\u00a0
other liabilities
Equity investments include equity instruments and capital contribution
\u00a0
to Telenor Pension Fund. Equity investments not
\u00a0
held for trading are
financial assets with changes in fair value
\u00a0
through other comprehensive income (FVTOCI).
\u00a0
Unrealised gains and losses are reclassified within equity
from other
\u00a0
reserves
\u00a0
to retained
\u00a0
earnings
\u00a0
when the
\u00a0
investment
\u00a0
is disposed.
\u00a0
Equity investments
\u00a0
held for
\u00a0
trading
\u00a0
are financial
\u00a0
assets with
\u00a0
changes in
fair value through profit and loss (FVTPL), and
\u00a0
transaction costs are immediately expensed. Telenor does currently
\u00a0
not have equity instruments held
for trading.
Telenor
\u00a0
uses derivative
\u00a0
financial
\u00a0
instruments
\u00a0
such as forward
\u00a0
currency
\u00a0
contracts,
\u00a0
interest rate
\u00a0
swaps and
\u00a0
cross currency
\u00a0
interest
\u00a0
rate swaps
\u00a0
to
hedge its risks associated with interest rate
\u00a0
and foreign currency fluctuations. The derivative financial instruments are
\u00a0
measured at fair value. Any
gains or
\u00a0
losses arising
\u00a0
from changes
\u00a0
in fair
\u00a0
value on derivatives
\u00a0
that are
\u00a0
not cash flow
\u00a0
hedges or
\u00a0
hedges of
\u00a0
net investments
\u00a0
are recognised
\u00a0
in the
income statement as financial income or expense.
\u00a0
Embedded derivatives
\u00a0
Embedded derivatives are separated from the host
\u00a0
contract and recognised
\u00a0
at fair value, except when the risks and
\u00a0
economic characteristics are
closely
\u00a0
related to
\u00a0
the host contract
\u00a0
and the host
\u00a0
contract
\u00a0
is not carried
\u00a0
at fair value.
\u00a0
The currency
\u00a0
derivative
\u00a0
embedded
\u00a0
in committed
\u00a0
purchase or
sales contracts
\u00a0
are not separated
\u00a0
when the
\u00a0
payment is
\u00a0
in one of
\u00a0
the party\u2019s
\u00a0
functional
\u00a0
currency
\u00a0
or in a commonly
\u00a0
used currency
\u00a0
in the relevant
economic environment. Unrealised gains or losses are
\u00a0
recognised in the income statement.
\u00a0
Other current and non-current financial assets
Financial
\u00a0
assets such
\u00a0
as various
\u00a0
receivables
\u00a0
and deposits
\u00a0
initially
\u00a0
recognised
\u00a0
at fair
\u00a0
value including
\u00a0
directly attributable
\u00a0
transactions
\u00a0
costs and
subsequently measured at amortised cost using the
\u00a0
effective interest rate method. These financial assets
\u00a0
are adjusted for provision for
impairment in accordance with the expected credit loss
\u00a0
model.
\u00a0
Lease receivables
In finance
\u00a0
leases, a
\u00a0
lease receivable
\u00a0
is recognised
\u00a0
based on
\u00a0
future expected
\u00a0
lease payments,
\u00a0
and finance
\u00a0
income is
\u00a0
allocated
\u00a0
using a
\u00a0
constant
periodic
\u00a0
rate of return
\u00a0
over the
\u00a0
lease term.
\u00a0
In a transaction
\u00a0
for which
\u00a0
an underlying
\u00a0
asset is
\u00a0
sub-leased
\u00a0
to a third
\u00a0
party, the
\u00a0
sublease is
\u00a0
classified
\u00a0
as a
finance or
\u00a0
operating
\u00a0
lease by
\u00a0
reference
\u00a0
to the right-of-use
\u00a0
asset arising
\u00a0
from the
\u00a0
head lease.
\u00a0
See note
\u00a0
3 for further
\u00a0
information
\u00a0
about operation
lease revenue.
NOTE 27
Financial assets and non-interest-bearing liabilities
Derivatives such as forward currency contracts and interest rate swaps
\u00a0
are used to mitigate financial risks. Other
financial assets include commercial papers, deposits, lease receivables
\u00a0
and equity investments.
\u00a0
Accounting policies
Financial
\u00a0
assets and
\u00a0
liabilities
A financial instrument is defined as any
\u00a0
contract that gives rise to a financial
\u00a0
asset of one entity and a financial liability or
\u00a0
equity instrument of
another entity. The financial instruments are recognised in
\u00a0
the statement of financial position when Telenor becomes
\u00a0
a party to the contractual
provisions of the instrument, using trade date
\u00a0
accounting. Financial assets and liabilities are offset
\u00a0
when there is intention and legally enforceable
right to
\u00a0
settle the
\u00a0
contracts
\u00a0
net.
Categories
\u00a0
of financial
\u00a0
assets and
\u00a0
liabilities
The categorisation of the financial instrument for
\u00a0
measurement purposes is based on the objective and
\u00a0
the contractual cash flow characteristics
determined at initial recognition. Telenor does not
\u00a0
apply the fair value option.
Telenor has financial assets classified in the following
\u00a0
measurement categories:
\u00a0
\u25cf
FAAC - financial
\u00a0
assets at
\u00a0
amortised
\u00a0
cost. Consist
\u00a0
of financial
\u00a0
assets held
\u00a0
to collect
\u00a0
contractual
\u00a0
cash flows
\u00a0
that are
\u00a0
solely payments
\u00a0
of
principal
\u00a0
and interest.
\u25cf
FVTOCI -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through other
\u00a0
comprehensive
\u00a0
income. Consist
\u00a0
of equity
\u00a0
investments
\u00a0
not held
\u00a0
for trading.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes,
\u00a0
assets held
\u00a0
for
trading
\u00a0
and financial
\u00a0
assets that
\u00a0
are not
\u00a0
classified
\u00a0
in one of
\u00a0
the other
\u00a0
categories.
Telenor has financial liabilities classified in the following
\u00a0
categories:
\u00a0
\u25cf
FLAC - financial
\u00a0
liabilities
\u00a0
at amortised
\u00a0
cost. Consist
\u00a0
of liabilities
\u00a0
that are
\u00a0
not a part
\u00a0
of the category
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
liabilities
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes and
\u00a0
other liabilities
Equity investments include equity instruments and capital contribution
\u00a0
to Telenor Pension Fund. Equity investments not
\u00a0
held for trading are
financial assets with changes in fair value
\u00a0
through other comprehensive income (FVTOCI).
\u00a0
Unrealised gains and losses are reclassified within equity
from other
\u00a0
reserves
\u00a0
to retained
\u00a0
earnings
\u00a0
when the
\u00a0
investment
\u00a0
is disposed.
\u00a0
Equity investments
\u00a0
held for
\u00a0
trading
\u00a0
are financial
\u00a0
assets with
\u00a0
changes in
fair value through profit and loss (FVTPL), and
\u00a0
transaction costs are immediately expensed. Telenor does currently
\u00a0
not have equity instruments held
for trading.
Telenor
\u00a0
uses derivative
\u00a0
financial
\u00a0
instruments
\u00a0
such as forward
\u00a0
currency
\u00a0
contracts,
\u00a0
interest rate
\u00a0
swaps and
\u00a0
cross currency
\u00a0
interest
\u00a0
rate swaps
\u00a0
to
hedge its risks associated with interest rate
\u00a0
and foreign currency fluctuations. The derivative financial instruments are
\u00a0
measured at fair value. Any
gains or
\u00a0
losses arising
\u00a0
from changes
\u00a0
in fair
\u00a0
value on derivatives
\u00a0
that are
\u00a0
not cash flow
\u00a0
hedges or
\u00a0
hedges of
\u00a0
net investments
\u00a0
are recognised
\u00a0
in the
income statement as financial income or expense.
\u00a0
Embedded derivatives
\u00a0
Embedded derivatives are separated from the host
\u00a0
contract and recognised
\u00a0
at fair value, except when the risks and
\u00a0
economic characteristics are
closely
\u00a0
related to
\u00a0
the host contract
\u00a0
and the host
\u00a0
contract
\u00a0
is not carried
\u00a0
at fair value.
\u00a0
The currency
\u00a0
derivative
\u00a0
embedded
\u00a0
in committed
\u00a0
purchase or
sales contracts
\u00a0
are not separated
\u00a0
when the
\u00a0
payment is
\u00a0
in one of
\u00a0
the party\u2019s
\u00a0
functional
\u00a0
currency
\u00a0
or in a commonly
\u00a0
used currency
\u00a0
in the relevant
economic environment. Unrealised gains or losses are
\u00a0
recognised in the income statement.
\u00a0
Other current and non-current financial assets
Financial
\u00a0
assets such
\u00a0
as various
\u00a0
receivables
\u00a0
and deposits
\u00a0
initially
\u00a0
recognised
\u00a0
at fair
\u00a0
value including
\u00a0
directly attributable
\u00a0
transactions
\u00a0
costs and
subsequently measured at amortised cost using the
\u00a0
effective interest rate method. These financial assets
\u00a0
are adjusted for provision for
impairment in accordance with the expected credit loss
\u00a0
model.
\u00a0
Lease receivables
In finance
\u00a0
leases, a
\u00a0
lease receivable
\u00a0
is recognised
\u00a0
based on
\u00a0
future expected
\u00a0
lease payments,
\u00a0
and finance
\u00a0
income is
\u00a0
allocated
\u00a0
using a
\u00a0
constant
periodic
\u00a0
rate of return
\u00a0
over the
\u00a0
lease term.
\u00a0
In a transaction
\u00a0
for which
\u00a0
an underlying
\u00a0
asset is
\u00a0
sub-leased
\u00a0
to a third
\u00a0
party, the
\u00a0
sublease is
\u00a0
classified
\u00a0
as a
finance or
\u00a0
operating
\u00a0
lease by
\u00a0
reference
\u00a0
to the right-of-use
\u00a0
asset arising
\u00a0
from the
\u00a0
head lease.
\u00a0
See note
\u00a0
3 for further
\u00a0
information
\u00a0
about operation
lease revenue.
Supply chain financing agreements
\u00a0
In supply chain financing agreements, the payables are
\u00a0
reclassified from trade payables to current non-interest
\u00a0
bearing liabilities when the
financing arrangements are linked to the payment
\u00a0
terms of the contract with the vendor.
\u00a0
The current liability is presented as
\u00a0
non-interest bearing
as the payment of interest is carried
\u00a0
by the vendor. When the financial institution makes
\u00a0
the payment to the vendor, an operational
\u00a0
cash outflow is
presented
\u00a0
in the Statement
\u00a0
of Cash Flows
\u00a0
if it is
\u00a0
related to
\u00a0
operating
\u00a0
activities
\u00a0
and cash outflow
\u00a0
from investing
\u00a0
activities
\u00a0
if it is related
\u00a0
to investing
activities. At the same time a financial
\u00a0
cash inflow reflecting that a financial liability has
\u00a0
been obtained. The subsequent payment of the financial
liability
\u00a0
is presented as financial cash outflow in
\u00a0
the cash flow statement. Supply chain financing
\u00a0
arrangements that do not have any link
\u00a0
to payment
terms or any
\u00a0
other parts
\u00a0
of the contract
\u00a0
with the
\u00a0
vendor are
\u00a0
classified
\u00a0
as trade
\u00a0
payables.
\u00a0
Cash outflow
\u00a0
from such arrangements
\u00a0
are presented
\u00a0
as
operating
\u00a0
activities
\u00a0
in the Statement
\u00a0
of Cash Flows.
Non-current financial
\u00a0
assets
NOK in millions
4)
Category
2022
2021
Equity investments
3
FVTOCI
1)
937
975
Financial derivatives
2
FVTPL
2)
248
59
Financial derivatives designated for net investment hedge
2
713
27
Other financial
\u00a0
non-current
\u00a0
non-interest-bearing
\u00a0
assets
FAAC
3)
3 066
3 318
Fair value hedge instruments
2
25
927
Other financial
\u00a0
non-current
\u00a0
interest-bearing
\u00a0
assets
FAAC
3)
3 230
970
Finance lease receivable
5)
1 046
1 356
Total non-current financial assets as of 31 December
9 264
7 632
1)
FVTOCI: Fair value through other comprehensive income.
\u00a0
2)
FVTPL: Fair value through profit and loss.
\u00a0
3)
FAAC: Financial assets at amortised cost.
\u00a0
4)
For information about the fair value level of financial
\u00a0
instruments, see note 32.
\u00a0
Equity investments
Equity investments (FVTOCI) include capital contribution to
\u00a0
Telenor Pension Fund of NOK 0.3 billion
\u00a0
and other equity investments of NOK 0.6 billion
(NOK 0.3 billion and NOK 0.7 billion in
\u00a0
2021,
\u00a0
respectively).
Other financial non-current non-interest-bearing assets
Other financial non-current non-interest-bearing
\u00a0
assets as of 31 December 2022 includes
\u00a0
a deposit of NOK 1.9 billion paid to
\u00a0
the Bangladesh
Telecommunication Regulatory Commission (BTRC, see note 23),
\u00a0
long term deposits of NOK 0.3 billion
\u00a0
and other non-current receivables of NOK
0.9 billion
\u00a0
(NOK 2.0
\u00a0
billion, NOK
\u00a0
0.6 billion
\u00a0
and of NOK
\u00a0
0.7 billion
\u00a0
in 2021,
\u00a0
respectively).
Other financial non-current interest-bearing
\u00a0
assets
Other financial
\u00a0
non-current
\u00a0
interest-bearing
\u00a0
assets includes
\u00a0
a receivable
\u00a0
against the
\u00a0
Norwegian
\u00a0
tax authorities
\u00a0
of NOK 2.7
\u00a0
billion related
\u00a0
to the
ongoing court
\u00a0
case for
\u00a0
losses on
\u00a0
receivables
\u00a0
on the Indian
\u00a0
subsidiary
\u00a0
Unitech Wireless
\u00a0
after having
\u00a0
repaid, as
\u00a0
guarantor,
\u00a0
all Unitech
\u00a0
Wireless\u2019
interest-bearing borrowings.
\u00a0
In 2019, Telenor paid an amount of
\u00a0
NOK 2.7 billion after an unfavourable decision by
\u00a0
the Norwegian tax authorities. In
March 2022, Telenor received a favourable verdict
\u00a0
and reversed the tax expense accordingly, see note 10.
Finance
\u00a0
lease receivables
Telenor has recognised receivables at present value
\u00a0
of future lease payments to be received in
\u00a0
lease arrangements where Telenor has transferred
substantially
\u00a0
all the risks
\u00a0
and rewards
\u00a0
incidental
\u00a0
to ownership
\u00a0
of the underlying
\u00a0
assets to
\u00a0
the lessee.
\u00a0
Current finance
\u00a0
lease receivables
\u00a0
are included
in Trade and other receivables (see note 19).
2022
2021
NOK in millions
Current
Non-current
Total
Current
Non-current
Total
Sublease of land
361
973
1 334
329
1 203
1 533
Lease of satellite
97
72
169
94
153
247
Total finance
\u00a0
lease receivables
458
1 046
1 504
423
1 356
1 779
During 2022, the Group recognised interest income
\u00a0
of NOK 60 million (NOK 73 million
\u00a0
in 2021) (note 9) related to finance lease receivables.
Dtac has Tower Service Agreement with the National
\u00a0
Telecom Public Company Limited (NT) and under the agreement,
\u00a0
dtac transferred towers that
dtac procured
\u00a0
under the
\u00a0
concession
\u00a0
agreement
\u00a0
to operate
\u00a0
and to provide
\u00a0
cellular
\u00a0
telephonic
\u00a0
service and
\u00a0
entered into
\u00a0
lease agreement
\u00a0
to use the
towers. The right to use towers from
\u00a0
NT was recognised as right-of-use asset with
\u00a0
corresponding lease liability. Under the agreement, dtac
\u00a0
shall
itself have lease agreements for the land
\u00a0
with landowners and shall receive compensation from NT
\u00a0
for this. dtac recognised lease agreements as a
lessee with
\u00a0
the landowners
\u00a0
for the land
\u00a0
related to
\u00a0
transferred
\u00a0
towers to
\u00a0
NT with
\u00a0
related lease
\u00a0
liabilities.
\u00a0
Right-of-use
\u00a0
assets related
\u00a0
to land was
derecognised on 1 January 2019 based on the
\u00a0
sublease arrangement with NT and a finance lease
\u00a0
receivable was recognised with reference to the
tenure of the agreement with NT.
\u00a0
The Group
\u00a0
entered into
\u00a0
a long-term
\u00a0
lease with
\u00a0
UPC on 1
\u00a0
April 2017
\u00a0
for the lease
\u00a0
of 9 transponders
\u00a0
on Thor
\u00a0
6, where
\u00a0
the final
\u00a0
payment from
\u00a0
UPC will
be made in
\u00a0
January 2025.
\u00a0
According
\u00a0
to the agreement,
\u00a0
substantially
\u00a0
all the risks
\u00a0
and rewards
\u00a0
related
\u00a0
to Thor 6
\u00a0
are transferred
\u00a0
to UPC, and
accordingly a finance lease receivable was recognised at present
\u00a0
value, which represents the deferred payments to
\u00a0
be received until January 2025.
\u00a0
The following
\u00a0
table sets
\u00a0
forth the
\u00a0
maturity
\u00a0
analysis
\u00a0
of lease
\u00a0
receivables:
NOK in millions
2022
2021
506
438
1 to 2 years
445
449
2 to 3 years
384
415
3 to 4 years
272
360
4 to 5 years
-
269
After 5 years
-
-
Total undiscounted lease payments receivable
1 607
1 931
Unearned
\u00a0
interest income
( 103)
( 152)
Net investment in leases
1 504
1 779
Current financial
\u00a0
assets
NOK in millions
3)
Category
2022
2021
Assets held
\u00a0
for trading
2
FVTPL
1)
50
48
Bonds and commercial papers > 3 months
FAAC
2)
277
327
Financial derivatives
\u00a0
2
FVTPL
1)
29
1
Financial derivatives designated for net investment hedge
2
2
320
Fair value hedge instruments
2
2
143
Total other current financial assets as of 31 December
361
839
Non-current
\u00a0
non-interest-bearing
\u00a0
liabilities
NOK in millions
3)
Category
2022
2021
Financial derivatives
\u00a0
2
FVTPL
1)
149
156
Financial derivatives designated for net investment hedge
2
1 306
950
Other non-current non-interest-bearing
\u00a0
liabilities
FLAC
2)
317
282
Total non-current non-interest-bearing
\u00a0
liabilities as of 31 December
1 772
1 388
Current non-interest-bearing
\u00a0
liabilities
NOK in millions
3)
Category
2022
2021
Financial derivatives
\u00a0
2
FVTPL
1)
3
6
Financial derivatives designated for net investment hedge
2
382
669
Other current non-interest-bearing
\u00a0
liabilities
FLAC
2)
1 308
1 294
Total current non-interest-bearing
\u00a0
liabilities as of 31 December
1 694
1 969
1)
FVTPL: Fair value through profit and loss.
2)
FLAC: Financial liabilities at amortised cost.
3)
For information about the fair value level of financial
\u00a0
instruments, see note 32.
Other current non-interest-bearing
\u00a0
liabilities include liabilities to financing institutions under supply
\u00a0
chain financing programs of NOK 616 million as
of 31 December 2022 (NOK 596 million as
\u00a0
of 31 December 2021).
NOTE 27
Financial assets and non-interest-bearing liabilities
Derivatives such as forward currency contracts and interest rate swaps
\u00a0
are used to mitigate financial risks. Other
financial assets include commercial papers, deposits, lease receivables
\u00a0
and equity investments.
\u00a0
Accounting policies
Financial
\u00a0
assets and
\u00a0
liabilities
A financial instrument is defined as any
\u00a0
contract that gives rise to a financial
\u00a0
asset of one entity and a financial liability or
\u00a0
equity instrument of
another entity. The financial instruments are recognised in
\u00a0
the statement of financial position when Telenor becomes
\u00a0
a party to the contractual
provisions of the instrument, using trade date
\u00a0
accounting. Financial assets and liabilities are offset
\u00a0
when there is intention and legally enforceable
right to
\u00a0
settle the
\u00a0
contracts
\u00a0
net.
Categories
\u00a0
of financial
\u00a0
assets and
\u00a0
liabilities
The categorisation of the financial instrument for
\u00a0
measurement purposes is based on the objective and
\u00a0
the contractual cash flow characteristics
determined at initial recognition. Telenor does not
\u00a0
apply the fair value option.
Telenor has financial assets classified in the following
\u00a0
measurement categories:
\u00a0
\u25cf
FAAC - financial
\u00a0
assets at
\u00a0
amortised
\u00a0
cost. Consist
\u00a0
of financial
\u00a0
assets held
\u00a0
to collect
\u00a0
contractual
\u00a0
cash flows
\u00a0
that are
\u00a0
solely payments
\u00a0
of
principal
\u00a0
and interest.
\u25cf
FVTOCI -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through other
\u00a0
comprehensive
\u00a0
income. Consist
\u00a0
of equity
\u00a0
investments
\u00a0
not held
\u00a0
for trading.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes,
\u00a0
assets held
\u00a0
for
trading
\u00a0
and financial
\u00a0
assets that
\u00a0
are not
\u00a0
classified
\u00a0
in one of
\u00a0
the other
\u00a0
categories.
Telenor has financial liabilities classified in the following
\u00a0
categories:
\u00a0
\u25cf
FLAC - financial
\u00a0
liabilities
\u00a0
at amortised
\u00a0
cost. Consist
\u00a0
of liabilities
\u00a0
that are
\u00a0
not a part
\u00a0
of the category
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
liabilities
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes and
\u00a0
other liabilities
Equity investments include equity instruments and capital contribution
\u00a0
to Telenor Pension Fund. Equity investments not
\u00a0
held for trading are
financial assets with changes in fair value
\u00a0
through other comprehensive income (FVTOCI).
\u00a0
Unrealised gains and losses are reclassified within equity
from other
\u00a0
reserves
\u00a0
to retained
\u00a0
earnings
\u00a0
when the
\u00a0
investment
\u00a0
is disposed.
\u00a0
Equity investments
\u00a0
held for
\u00a0
trading
\u00a0
are financial
\u00a0
assets with
\u00a0
changes in
fair value through profit and loss (FVTPL), and
\u00a0
transaction costs are immediately expensed. Telenor does currently
\u00a0
not have equity instruments held
for trading.
Telenor
\u00a0
uses derivative
\u00a0
financial
\u00a0
instruments
\u00a0
such as forward
\u00a0
currency
\u00a0
contracts,
\u00a0
interest rate
\u00a0
swaps and
\u00a0
cross currency
\u00a0
interest
\u00a0
rate swaps
\u00a0
to
hedge its risks associated with interest rate
\u00a0
and foreign currency fluctuations. The derivative financial instruments are
\u00a0
measured at fair value. Any
gains or
\u00a0
losses arising
\u00a0
from changes
\u00a0
in fair
\u00a0
value on derivatives
\u00a0
that are
\u00a0
not cash flow
\u00a0
hedges or
\u00a0
hedges of
\u00a0
net investments
\u00a0
are recognised
\u00a0
in the
income statement as financial income or expense.
\u00a0
Embedded derivatives
\u00a0
Embedded derivatives are separated from the host
\u00a0
contract and recognised
\u00a0
at fair value, except when the risks and
\u00a0
economic characteristics are
closely
\u00a0
related to
\u00a0
the host contract
\u00a0
and the host
\u00a0
contract
\u00a0
is not carried
\u00a0
at fair value.
\u00a0
The currency
\u00a0
derivative
\u00a0
embedded
\u00a0
in committed
\u00a0
purchase or
sales contracts
\u00a0
are not separated
\u00a0
when the
\u00a0
payment is
\u00a0
in one of
\u00a0
the party\u2019s
\u00a0
functional
\u00a0
currency
\u00a0
or in a commonly
\u00a0
used currency
\u00a0
in the relevant
economic environment. Unrealised gains or losses are
\u00a0
recognised in the income statement.
\u00a0
Other current and non-current financial assets
Financial
\u00a0
assets such
\u00a0
as various
\u00a0
receivables
\u00a0
and deposits
\u00a0
initially
\u00a0
recognised
\u00a0
at fair
\u00a0
value including
\u00a0
directly attributable
\u00a0
transactions
\u00a0
costs and
subsequently measured at amortised cost using the
\u00a0
effective interest rate method. These financial assets
\u00a0
are adjusted for provision for
impairment in accordance with the expected credit loss
\u00a0
model.
\u00a0
Lease receivables
In finance
\u00a0
leases, a
\u00a0
lease receivable
\u00a0
is recognised
\u00a0
based on
\u00a0
future expected
\u00a0
lease payments,
\u00a0
and finance
\u00a0
income is
\u00a0
allocated
\u00a0
using a
\u00a0
constant
periodic
\u00a0
rate of return
\u00a0
over the
\u00a0
lease term.
\u00a0
In a transaction
\u00a0
for which
\u00a0
an underlying
\u00a0
asset is
\u00a0
sub-leased
\u00a0
to a third
\u00a0
party, the
\u00a0
sublease is
\u00a0
classified
\u00a0
as a
finance or
\u00a0
operating
\u00a0
lease by
\u00a0
reference
\u00a0
to the right-of-use
\u00a0
asset arising
\u00a0
from the
\u00a0
head lease.
\u00a0
See note
\u00a0
3 for further
\u00a0
information
\u00a0
about operation
lease revenue.
Supply chain financing agreements
\u00a0
In supply chain financing agreements, the payables are
\u00a0
reclassified from trade payables to current non-interest
\u00a0
bearing liabilities when the
financing arrangements are linked to the payment
\u00a0
terms of the contract with the vendor.
\u00a0
The current liability is presented as
\u00a0
non-interest bearing
as the payment of interest is carried
\u00a0
by the vendor. When the financial institution makes
\u00a0
the payment to the vendor, an operational
\u00a0
cash outflow is
presented
\u00a0
in the Statement
\u00a0
of Cash Flows
\u00a0
if it is
\u00a0
related to
\u00a0
operating
\u00a0
activities
\u00a0
and cash outflow
\u00a0
from investing
\u00a0
activities
\u00a0
if it is related
\u00a0
to investing
activities. At the same time a financial
\u00a0
cash inflow reflecting that a financial liability has
\u00a0
been obtained. The subsequent payment of the financial
liability
\u00a0
is presented as financial cash outflow in
\u00a0
the cash flow statement. Supply chain financing
\u00a0
arrangements that do not have any link
\u00a0
to payment
terms or any
\u00a0
other parts
\u00a0
of the contract
\u00a0
with the
\u00a0
vendor are
\u00a0
classified
\u00a0
as trade
\u00a0
payables.
\u00a0
Cash outflow
\u00a0
from such arrangements
\u00a0
are presented
\u00a0
as
operating
\u00a0
activities
\u00a0
in the Statement
\u00a0
of Cash Flows.
Non-current financial
\u00a0
assets
NOK in millions
4)
Category
2022
2021
Equity investments
3
FVTOCI
1)
937
975
Financial derivatives
2
FVTPL
2)
248
59
Financial derivatives designated for net investment hedge
2
713
27
Other financial
\u00a0
non-current
\u00a0
non-interest-bearing
\u00a0
assets
FAAC
3)
3 066
3 318
Fair value hedge instruments
2
25
927
Other financial
\u00a0
non-current
\u00a0
interest-bearing
\u00a0
assets
FAAC
3)
3 230
970
Finance lease receivable
5)
1 046
1 356
Total non-current financial assets as of 31 December
9 264
7 632
1)
FVTOCI: Fair value through other comprehensive income.
\u00a0
2)
FVTPL: Fair value through profit and loss.
\u00a0
3)
FAAC: Financial assets at amortised cost.
\u00a0
4)
For information about the fair value level of financial
\u00a0
instruments, see note 32.
\u00a0
Equity investments
Equity investments (FVTOCI) include capital contribution to
\u00a0
Telenor Pension Fund of NOK 0.3 billion
\u00a0
and other equity investments of NOK 0.6 billion
(NOK 0.3 billion and NOK 0.7 billion in
\u00a0
2021,
\u00a0
respectively).
Other financial non-current non-interest-bearing assets
Other financial non-current non-interest-bearing
\u00a0
assets as of 31 December 2022 includes
\u00a0
a deposit of NOK 1.9 billion paid to
\u00a0
the Bangladesh
Telecommunication Regulatory Commission (BTRC, see note 23),
\u00a0
long term deposits of NOK 0.3 billion
\u00a0
and other non-current receivables of NOK
0.9 billion
\u00a0
(NOK 2.0
\u00a0
billion, NOK
\u00a0
0.6 billion
\u00a0
and of NOK
\u00a0
0.7 billion
\u00a0
in 2021,
\u00a0
respectively).
Other financial non-current interest-bearing
\u00a0
assets
Other financial
\u00a0
non-current
\u00a0
interest-bearing
\u00a0
assets includes
\u00a0
a receivable
\u00a0
against the
\u00a0
Norwegian
\u00a0
tax authorities
\u00a0
of NOK 2.7
\u00a0
billion related
\u00a0
to the
ongoing court
\u00a0
case for
\u00a0
losses on
\u00a0
receivables
\u00a0
on the Indian
\u00a0
subsidiary
\u00a0
Unitech Wireless
\u00a0
after having
\u00a0
repaid, as
\u00a0
guarantor,
\u00a0
all Unitech
\u00a0
Wireless\u2019
interest-bearing borrowings.
\u00a0
In 2019, Telenor paid an amount of
\u00a0
NOK 2.7 billion after an unfavourable decision by
\u00a0
the Norwegian tax authorities. In
March 2022, Telenor received a favourable verdict
\u00a0
and reversed the tax expense accordingly, see note 10.
Finance
\u00a0
lease receivables
Telenor has recognised receivables at present value
\u00a0
of future lease payments to be received in
\u00a0
lease arrangements where Telenor has transferred
substantially
\u00a0
all the risks
\u00a0
and rewards
\u00a0
incidental
\u00a0
to ownership
\u00a0
of the underlying
\u00a0
assets to
\u00a0
the lessee.
\u00a0
Current finance
\u00a0
lease receivables
\u00a0
are included
in Trade and other receivables (see note 19).
2022
2021
NOK in millions
Current
Non-current
Total
Current
Non-current
Total
Sublease of land
361
973
1 334
329
1 203
1 533
Lease of satellite
97
72
169
94
153
247
Total finance
\u00a0
lease receivables
458
1 046
1 504
423
1 356
1 779
During 2022, the Group recognised interest income
\u00a0
of NOK 60 million (NOK 73 million
\u00a0
in 2021) (note 9) related to finance lease receivables.
Dtac has Tower Service Agreement with the National
\u00a0
Telecom Public Company Limited (NT) and under the agreement,
\u00a0
dtac transferred towers that
dtac procured
\u00a0
under the
\u00a0
concession
\u00a0
agreement
\u00a0
to operate
\u00a0
and to provide
\u00a0
cellular
\u00a0
telephonic
\u00a0
service and
\u00a0
entered into
\u00a0
lease agreement
\u00a0
to use the
towers. The right to use towers from
\u00a0
NT was recognised as right-of-use asset with
\u00a0
corresponding lease liability. Under the agreement, dtac
\u00a0
shall
itself have lease agreements for the land
\u00a0
with landowners and shall receive compensation from NT
\u00a0
for this. dtac recognised lease agreements as a
lessee with
\u00a0
the landowners
\u00a0
for the land
\u00a0
related to
\u00a0
transferred
\u00a0
towers to
\u00a0
NT with
\u00a0
related lease
\u00a0
liabilities.
\u00a0
Right-of-use
\u00a0
assets related
\u00a0
to land was
derecognised on 1 January 2019 based on the
\u00a0
sublease arrangement with NT and a finance lease
\u00a0
receivable was recognised with reference to the
tenure of the agreement with NT.
\u00a0
The Group
\u00a0
entered into
\u00a0
a long-term
\u00a0
lease with
\u00a0
UPC on 1
\u00a0
April 2017
\u00a0
for the lease
\u00a0
of 9 transponders
\u00a0
on Thor
\u00a0
6, where
\u00a0
the final
\u00a0
payment from
\u00a0
UPC will
be made in
\u00a0
January 2025.
\u00a0
According
\u00a0
to the agreement,
\u00a0
substantially
\u00a0
all the risks
\u00a0
and rewards
\u00a0
related
\u00a0
to Thor 6
\u00a0
are transferred
\u00a0
to UPC, and
accordingly a finance lease receivable was recognised at present
\u00a0
value, which represents the deferred payments to
\u00a0
be received until January 2025.
\u00a0
The following
\u00a0
table sets
\u00a0
forth the
\u00a0
maturity
\u00a0
analysis
\u00a0
of lease
\u00a0
receivables:
NOK in millions
2022
2021
506
438
1 to 2 years
445
449
2 to 3 years
384
415
3 to 4 years
272
360
4 to 5 years
-
269
After 5 years
-
-
Total undiscounted lease payments receivable
1 607
1 931
Unearned
\u00a0
interest income
( 103)
( 152)
Net investment in leases
1 504
1 779
Current financial
\u00a0
assets
NOK in millions
3)
Category
2022
2021
Assets held
\u00a0
for trading
2
FVTPL
1)
50
48
Bonds and commercial papers > 3 months
FAAC
2)
277
327
Financial derivatives
\u00a0
2
FVTPL
1)
29
1
Financial derivatives designated for net investment hedge
2
2
320
Fair value hedge instruments
2
2
143
Total other current financial assets as of 31 December
361
839
Non-current
\u00a0
non-interest-bearing
\u00a0
liabilities
NOK in millions
3)
Category
2022
2021
Financial derivatives
\u00a0
2
FVTPL
1)
149
156
Financial derivatives designated for net investment hedge
2
1 306
950
Other non-current non-interest-bearing
\u00a0
liabilities
FLAC
2)
317
282
Total non-current non-interest-bearing
\u00a0
liabilities as of 31 December
1 772
1 388
Current non-interest-bearing
\u00a0
liabilities
NOK in millions
3)
Category
2022
2021
Financial derivatives
\u00a0
2
FVTPL
1)
3
6
Financial derivatives designated for net investment hedge
2
382
669
Other current non-interest-bearing
\u00a0
liabilities
FLAC
2)
1 308
1 294
Total current non-interest-bearing
\u00a0
liabilities as of 31 December
1 694
1 969
1)
FVTPL: Fair value through profit and loss.
2)
FLAC: Financial liabilities at amortised cost.
3)
For information about the fair value level of financial
\u00a0
instruments, see note 32.
Other current non-interest-bearing
\u00a0
liabilities include liabilities to financing institutions under supply
\u00a0
chain financing programs of NOK 616 million as
of 31 December 2022 (NOK 596 million as
\u00a0
of 31 December 2021).
Accounting policies
Financial
\u00a0
assets and
\u00a0
liabilities
A financial instrument is defined as any
\u00a0
contract that gives rise to a financial
\u00a0
asset of one entity and a financial liability or
\u00a0
equity instrument of
another entity. The financial instruments are recognised in
\u00a0
the statement of financial position when Telenor becomes
\u00a0
a party to the contractual
provisions of the instrument, using trade date
\u00a0
accounting. Financial assets and liabilities are offset
\u00a0
when there is intention and legally enforceable
right to
\u00a0
settle the
\u00a0
contracts
\u00a0
net.
Categories
\u00a0
of financial
\u00a0
assets and
\u00a0
liabilities
The categorisation of the financial instrument for
\u00a0
measurement purposes is based on the objective and
\u00a0
the contractual cash flow characteristics
determined at initial recognition. Telenor does not
\u00a0
apply the fair value option.
Telenor has financial assets classified in the following
\u00a0
measurement categories:
\u00a0
\u25cf
FAAC - financial
\u00a0
assets at
\u00a0
amortised
\u00a0
cost. Consist
\u00a0
of financial
\u00a0
assets held
\u00a0
to collect
\u00a0
contractual
\u00a0
cash flows
\u00a0
that are
\u00a0
solely payments
\u00a0
of
principal
\u00a0
and interest.
\u25cf
FVTOCI -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through other
\u00a0
comprehensive
\u00a0
income. Consist
\u00a0
of equity
\u00a0
investments
\u00a0
not held
\u00a0
for trading.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes,
\u00a0
assets held
\u00a0
for
trading
\u00a0
and financial
\u00a0
assets that
\u00a0
are not
\u00a0
classified
\u00a0
in one of
\u00a0
the other
\u00a0
categories.
Telenor has financial liabilities classified in the following
\u00a0
categories:
\u00a0
\u25cf
FLAC - financial
\u00a0
liabilities
\u00a0
at amortised
\u00a0
cost. Consist
\u00a0
of liabilities
\u00a0
that are
\u00a0
not a part
\u00a0
of the category
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
liabilities
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes and
\u00a0
other liabilities
Equity investments include equity instruments and capital contribution
\u00a0
to Telenor Pension Fund. Equity investments not
\u00a0
held for trading are
financial assets with changes in fair value
\u00a0
through other comprehensive income (FVTOCI).
\u00a0
Unrealised gains and losses are reclassified within equity
from other
\u00a0
reserves
\u00a0
to retained
\u00a0
earnings
\u00a0
when the
\u00a0
investment
\u00a0
is disposed.
\u00a0
Equity investments
\u00a0
held for
\u00a0
trading
\u00a0
are financial
\u00a0
assets with
\u00a0
changes in
fair value through profit and loss (FVTPL), and
\u00a0
transaction costs are immediately expensed. Telenor does currently
\u00a0
not have equity instruments held
for trading.
Telenor
\u00a0
uses derivative
\u00a0
financial
\u00a0
instruments
\u00a0
such as forward
\u00a0
currency
\u00a0
contracts,
\u00a0
interest rate
\u00a0
swaps and
\u00a0
cross currency
\u00a0
interest
\u00a0
rate swaps
\u00a0
to
hedge its risks associated with interest rate
\u00a0
and foreign currency fluctuations. The derivative financial instruments are
\u00a0
measured at fair value. Any
gains or
\u00a0
losses arising
\u00a0
from changes
\u00a0
in fair
\u00a0
value on derivatives
\u00a0
that are
\u00a0
not cash flow
\u00a0
hedges or
\u00a0
hedges of
\u00a0
net investments
\u00a0
are recognised
\u00a0
in the
income statement as financial income or expense.
\u00a0
Embedded derivatives
\u00a0
Embedded derivatives are separated from the host
\u00a0
contract and recognised
\u00a0
at fair value, except when the risks and
\u00a0
economic characteristics are
closely
\u00a0
related to
\u00a0
the host contract
\u00a0
and the host
\u00a0
contract
\u00a0
is not carried
\u00a0
at fair value.
\u00a0
The currency
\u00a0
derivative
\u00a0
embedded
\u00a0
in committed
\u00a0
purchase or
sales contracts
\u00a0
are not separated
\u00a0
when the
\u00a0
payment is
\u00a0
in one of
\u00a0
the party\u2019s
\u00a0
functional
\u00a0
currency
\u00a0
or in a commonly
\u00a0
used currency
\u00a0
in the relevant
economic environment. Unrealised gains or losses are
\u00a0
recognised in the income statement.
\u00a0
Other current and non-current financial assets
Financial
\u00a0
assets such
\u00a0
as various
\u00a0
receivables
\u00a0
and deposits
\u00a0
initially
\u00a0
recognised
\u00a0
at fair
\u00a0
value including
\u00a0
directly attributable
\u00a0
transactions
\u00a0
costs and
subsequently measured at amortised cost using the
\u00a0
effective interest rate method. These financial assets
\u00a0
are adjusted for provision for
impairment in accordance with the expected credit loss
\u00a0
model.
\u00a0
Lease receivables
In finance
\u00a0
leases, a
\u00a0
lease receivable
\u00a0
is recognised
\u00a0
based on
\u00a0
future expected
\u00a0
lease payments,
\u00a0
and finance
\u00a0
income is
\u00a0
allocated
\u00a0
using a
\u00a0
constant
periodic
\u00a0
rate of return
\u00a0
over the
\u00a0
lease term.
\u00a0
In a transaction
\u00a0
for which
\u00a0
an underlying
\u00a0
asset is
\u00a0
sub-leased
\u00a0
to a third
\u00a0
party, the
\u00a0
sublease is
\u00a0
classified
\u00a0
as a
finance or
\u00a0
operating
\u00a0
lease by
\u00a0
reference
\u00a0
to the right-of-use
\u00a0
asset arising
\u00a0
from the
\u00a0
head lease.
\u00a0
See note
\u00a0
3 for further
\u00a0
information
\u00a0
about operation
lease revenue.
Supply chain financing agreements
\u00a0
In supply chain financing agreements, the payables are
\u00a0
reclassified from trade payables to current non-interest
\u00a0
bearing liabilities when the
financing arrangements are linked to the payment
\u00a0
terms of the contract with the vendor.
\u00a0
The current liability is presented as
\u00a0
non-interest bearing
as the payment of interest is carried
\u00a0
by the vendor. When the financial institution makes
\u00a0
the payment to the vendor, an operational
\u00a0
cash outflow is
presented
\u00a0
in the Statement
\u00a0
of Cash Flows
\u00a0
if it is
\u00a0
related to
\u00a0
operating
\u00a0
activities
\u00a0
and cash outflow
\u00a0
from investing
\u00a0
activities
\u00a0
if it is related
\u00a0
to investing
activities. At the same time a financial
\u00a0
cash inflow reflecting that a financial liability has
\u00a0
been obtained. The subsequent payment of the financial
liability
\u00a0
is presented as financial cash outflow in
\u00a0
the cash flow statement. Supply chain financing
\u00a0
arrangements that do not have any link
\u00a0
to payment
terms or any
\u00a0
other parts
\u00a0
of the contract
\u00a0
with the
\u00a0
vendor are
\u00a0
classified
\u00a0
as trade
\u00a0
payables.
\u00a0
Cash outflow
\u00a0
from such arrangements
\u00a0
are presented
\u00a0
as
operating
\u00a0
activities
\u00a0
in the Statement
\u00a0
of Cash Flows.
Accounting policies
Hedge accounting is applied for fair value
\u00a0
hedges and hedges of net investments in foreign
\u00a0
operations when the hedging criteria are met.
\u00a0
For fair
value
\u00a0
hedges, the carrying amount of the hedged
\u00a0
item is adjusted for gains and losses attributable
\u00a0
to the risk being hedged. The derivative is also
measured at fair value, and gains and losses
\u00a0
from both the hedging instrument and the hedged
\u00a0
item are recognised in the income statement.
Hedge effectiveness
\u00a0
is assessed
\u00a0
on an ongoing
\u00a0
basis, and
\u00a0
hedge accounting
\u00a0
is discontinued
\u00a0
if the hedge
\u00a0
no longer
\u00a0
meets the
\u00a0
hedge accounting
criteria.
\u00a0
If the hedged
\u00a0
item still
\u00a0
exists and
\u00a0
is not sold,
\u00a0
the fair
\u00a0
value adjustment
\u00a0
to the hedged
\u00a0
item attributable
\u00a0
to the risk
\u00a0
being hedged
\u00a0
at de-
designation
\u00a0
will be
\u00a0
amortised
\u00a0
in the income
\u00a0
statement
\u00a0
over the
\u00a0
remaining
\u00a0
time to maturity.
\u00a0
A hedge
\u00a0
of a net investment
\u00a0
in a foreign
\u00a0
operation
\u00a0
is accounted
\u00a0
for in a
\u00a0
similar way
\u00a0
as a cash
\u00a0
flow hedge.
\u00a0
Foreign exchange
\u00a0
gains or
\u00a0
losses on
\u00a0
the
hedging instrument relating to the effective portion of
\u00a0
the hedge are recognised directly in other
\u00a0
comprehensive income while any foreign
exchange gains or losses relating to the
\u00a0
ineffective portion are recognised in the income statement.
\u00a0
On disposal of the foreign entity, the
cumulative foreign exchange gains or losses recognised in
\u00a0
other comprehensive income is reclassified to the
\u00a0
income statement.
Refer to
\u00a0
note 27 Financial
\u00a0
assets and
\u00a0
liabilities
\u00a0
for further
\u00a0
information
\u00a0
on accounting
\u00a0
policies
\u00a0
for derivatives.
.
Accounting policies
Financial
\u00a0
assets and
\u00a0
liabilities
A financial instrument is defined as any
\u00a0
contract that gives rise to a financial
\u00a0
asset of one entity and a financial liability or
\u00a0
equity instrument of
another entity. The financial instruments are recognised in
\u00a0
the statement of financial position when Telenor becomes
\u00a0
a party to the contractual
provisions of the instrument, using trade date
\u00a0
accounting. Financial assets and liabilities are offset
\u00a0
when there is intention and legally enforceable
right to
\u00a0
settle the
\u00a0
contracts
\u00a0
net.
Categories
\u00a0
of financial
\u00a0
assets and
\u00a0
liabilities
The categorisation of the financial instrument for
\u00a0
measurement purposes is based on the objective and
\u00a0
the contractual cash flow characteristics
determined at initial recognition. Telenor does not
\u00a0
apply the fair value option.
Telenor has financial assets classified in the following
\u00a0
measurement categories:
\u00a0
\u25cf
FAAC - financial
\u00a0
assets at
\u00a0
amortised
\u00a0
cost. Consist
\u00a0
of financial
\u00a0
assets held
\u00a0
to collect
\u00a0
contractual
\u00a0
cash flows
\u00a0
that are
\u00a0
solely payments
\u00a0
of
principal
\u00a0
and interest.
\u25cf
FVTOCI -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through other
\u00a0
comprehensive
\u00a0
income. Consist
\u00a0
of equity
\u00a0
investments
\u00a0
not held
\u00a0
for trading.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
assets at
\u00a0
fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes,
\u00a0
assets held
\u00a0
for
trading
\u00a0
and financial
\u00a0
assets that
\u00a0
are not
\u00a0
classified
\u00a0
in one of
\u00a0
the other
\u00a0
categories.
Telenor has financial liabilities classified in the following
\u00a0
categories:
\u00a0
\u25cf
FLAC - financial
\u00a0
liabilities
\u00a0
at amortised
\u00a0
cost. Consist
\u00a0
of liabilities
\u00a0
that are
\u00a0
not a part
\u00a0
of the category
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u25cf
FVTPL -
\u00a0
financial
\u00a0
liabilities
\u00a0
at fair value
\u00a0
through profit
\u00a0
or loss.
\u00a0
Include derivatives
\u00a0
not designated
\u00a0
for hedging
\u00a0
purposes and
\u00a0
other liabilities
Interest-bearing
\u00a0
liabilities
2022
2021
NOK in millions
Current interest-
bearing liabilities
Non-current
interest-bearing
liabilities
Total
Current interest-
bearing liabilities
Non-current
interest-bearing
liabilities
Total
Interest-bearing liabilities measured at amortised cost
Bank loans
1 586
2 349
3 935
2 783
3 331
6 115
Bonds
6 969
76 529
83 498
6 423
83 781
90 204
Other liabilities
604
194
798
70
579
648
Interest-bearing liabilities measured at fair value
Fair value hedge instruments
10
3 652
3 662
-
120
120
Total interest-bearing
\u00a0
liabilities
9 169
82 724
91 893
9 276
87 811
97 087
Fair value of debt
1)
99 389
99 389
Of which fair value hierarchy level 1
2)
92 421
92 421
Of which fair value hierarchy level 2
2)
6 968
6 968
1)
Excluding lease liabilities and licence obligations.
\u00a0
2)
For information about the fair value hierarchy for valuation
\u00a0
of financial instruments, see note 32.
\u00a0
Non-current
\u00a0
interest-bearing
\u00a0
liabilities
2022
2021
NOK in millions
Currency
Debt before
\u00a0
the
\u00a0
swaps
Debt adjusted
\u00a0
for
\u00a0
currency swaps
2)
Debt before
\u00a0
the
\u00a0
swaps
Debt adjusted
\u00a0
for
\u00a0
currency swaps
2)
EUR
60 714
35 496
62 981
39 014
NOK
1)
-
(2 735)
-
(2 735)
SEK
4 248
15 670
4 376
16 152
USD
-
13 612
-
15 540
Total Telenor ASA
64 962
62 044
67 357
67 970
DNA - Finland
EUR
2 601
2 601
2 454
2 454
dtac - Thailand
THB
14 967
14 967
13 558
13 558
Digi - Malaysia
MYR
-
-
3 863
3 863
Other non-current interest-bearing
\u00a0
liabilities
194
194
578
578
Total subsidiaries
17 762
17 762
20 454
20 454
Total non-current interest-bearing liabilities
82 724
79 805
87 811
88 424
1)
Telenor ASA\u2019s debt position in Norwegian Kroner is
\u00a0
a net asset position when including currency swaps.
\u00a0
2)
Debt adjusted for currency swaps includes financial instruments
\u00a0
that are not classified as interest-bearing liabilities
\u00a0
in the statement of financial position.
Accounting policies
Financial
\u00a0
assets and
\u00a0
liabilities
A financial instrument is defined as any
\u00a0
contract that gives rise to a financial
\u00a0
asset of one entity and a financial liability or
\u00a0
equity instrument of
another entity. The financial instruments are recognised in
\u00a0
the statement of financial position when Telenor becomes
\u00a0
a party to the contractual
provisions of the instrument, using trade date
\u00a0
accounting. Financial assets and liabilities are offset
\u00a0
when there is intention and legally enforceable
right to
\u00a0
settle the
\u00a0
contracts
\u00a0
net.
NOK in millions
4)
Category
2022
2021
Equity investments
3
FVTOCI
1)
937
975
Financial derivatives
2
FVTPL
2)
248
59
Financial derivatives designated for net investment hedge
2
713
27
Other financial
\u00a0
non-current
\u00a0
non-interest-bearing
\u00a0
assets
FAAC
3)
3 066
3 318
Fair value hedge instruments
2
25
927
Other financial
\u00a0
non-current
\u00a0
interest-bearing
\u00a0
assets
FAAC
3)
3 230
970
Finance lease receivable
5)
1 046
1 356
Total non-current financial assets as of 31 December
9 264
7 632
1)
FVTOCI: Fair value through other comprehensive income.
\u00a0
2)
FVTPL: Fair value through profit and loss.
\u00a0
3)
FAAC: Financial assets at amortised cost.
\u00a0
4)
For information about the fair value level of financial
\u00a0
instruments, see note 32.
\u00a0
Equity investments
Equity investments (FVTOCI) include capital contribution to
\u00a0
Telenor Pension Fund of NOK 0.3 billion
\u00a0
and other equity investments of NOK 0.6 billion
(NOK 0.3 billion and NOK 0.7 billion in
\u00a0
2021,
\u00a0
respectively).
Other financial non-current non-interest-bearing assets
Other financial non-current non-interest-bearing
\u00a0
assets as of 31 December 2022 includes
\u00a0
a deposit of NOK 1.9 billion paid to
\u00a0
the Bangladesh
Telecommunication Regulatory Commission (BTRC, see note 23),
\u00a0
long term deposits of NOK 0.3 billion
\u00a0
and other non-current receivables of NOK
0.9 billion
\u00a0
(NOK 2.0
\u00a0
billion, NOK
\u00a0
0.6 billion
\u00a0
and of NOK
\u00a0
0.7 billion
\u00a0
in 2021,
\u00a0
respectively).
Other financial non-current interest-bearing
\u00a0
assets
Other financial
\u00a0
non-current
\u00a0
interest-bearing
\u00a0
assets includes
\u00a0
a receivable
\u00a0
against the
\u00a0
Norwegian
\u00a0
tax authorities
\u00a0
of NOK 2.7
\u00a0
billion related
\u00a0
to the
ongoing court
\u00a0
case for
\u00a0
losses on
\u00a0
receivables
\u00a0
on the Indian
\u00a0
subsidiary
\u00a0
Unitech Wireless
\u00a0
after having
\u00a0
repaid, as
\u00a0
guarantor,
\u00a0
all Unitech
\u00a0
Wireless\u2019
interest-bearing borrowings.
\u00a0
In 2019, Telenor paid an amount of
\u00a0
NOK 2.7 billion after an unfavourable decision by
\u00a0
the Norwegian tax authorities. In
March 2022, Telenor received a favourable verdict
\u00a0
and reversed the tax expense accordingly, see note 10.
Non-current
\u00a0
non-interest-bearing
\u00a0
liabilities
NOK in millions
3)
Category
2022
2021
Financial derivatives
\u00a0
2
FVTPL
1)
149
156
Financial derivatives designated for net investment hedge
2
1 306
950
Other non-current non-interest-bearing
\u00a0
liabilities
FLAC
2)
317
282
Total non-current non-interest-bearing
\u00a0
liabilities as of 31 December
1 772
1 388
Current non-interest-bearing
\u00a0
liabilities
NOK in millions
3)
Category
2022
2021
Financial derivatives
\u00a0
2
FVTPL
1)
3
6
Financial derivatives designated for net investment hedge
2
382
669
Other current non-interest-bearing
\u00a0
liabilities
FLAC
2)
1 308
1 294
Total current non-interest-bearing
\u00a0
liabilities as of 31 December
1 694
1 969
1)
FVTPL: Fair value through profit and loss.
2)
FLAC: Financial liabilities at amortised cost.
3)
For information about the fair value level of financial
\u00a0
instruments, see note 32.
NOTE 28
Equity
Paid-in capital
NOK in millions,
\u00a0
except number
\u00a0
of shares
Share capital
Other paid
\u00a0
in capital
Total paid-in
\u00a0
capital
Equity as of 1 January 2021
8 397
69
-
8 466
Share buyback
-
-
-
-
-
Cancellation
\u00a0
of shares
-
-
-
-
-
Equity as of 31 December 2021
8 397
69
-
8 466
Share buyback
-
-
-
-
-
Cancellation
\u00a0
of shares
-
-
-
-
-
Equity as of 31 December 2022
8 397
69
-
8 466
Nominal value
\u00a0
per share
\u00a0
is NOK 6.
At the Extraordinary General Meeting on 26 January
\u00a0
2023, The Board of Directors authorised a new
\u00a0
share buyback program. At the same time the
company has
\u00a0
the intention
\u00a0
to enter
\u00a0
into an agreement
\u00a0
with the
\u00a0
Norwegian
\u00a0
State represented
\u00a0
by the Ministry
\u00a0
of Trade,
\u00a0
Industry and
\u00a0
Fisheries
\u00a0
to buy
back shares
\u00a0
for the purpose
\u00a0
of cancellation
\u00a0
of shares
\u00a0
and write-down
\u00a0
of share
\u00a0
capital in
\u00a0
order to
\u00a0
maintain the
\u00a0
Government
\u00a0
proportion
\u00a0
of the total
shares. The
\u00a0
Board of
\u00a0
Directors
\u00a0
is authorised
\u00a0
to acquire
\u00a0
up to 47
\u00a0
000 000 own
\u00a0
shares with
\u00a0
nominal value
\u00a0
of NOK 282
\u00a0
million which
\u00a0
corresponds
\u00a0
to
approximately 3.4% of the company\u2019s share capital.
\u00a0
The share buyback is limited to NOK 3.7
\u00a0
billion. The authorisation is valid until 31
\u00a0
December
Other reserves
NOK in millions
Net unrealised
gains/(losses)
reserve
Employee
equity bene-
fits reserve
Pension
remeasure-
ment reserve
Transactions
with non-
controlling
interests
Share of equity
other
comprehensive
income in
associated
companies
Other equity
transactions
Total other
reserves
Equity as of 1 January 2021
117
403
298
-
1 469
(24 302)
(22 014)
Other comprehensive
\u00a0
income (loss),
\u00a0
net of taxes
134
-
204
-
76
-
415
Share-based payment
-
66
-
-
-
-
66
Equity adjustments
\u00a0
in associated
\u00a0
companies
-
-
-
-
3
-
3
Equity as of 31 December 2021
251
469
503
-
1 548
(24 302)
(21 530)
Other comprehensive
\u00a0
income (loss),
\u00a0
net of taxes
157
-
520
-
46
-
723
Share-based payment
-
61
-
-
-
-
61
Other changes in other reserves during 2022
408
531
1 023
-
1 594
(24 302)
(20 746)
Net unrealised gains/losses reserve
This reserve includes unrealised gains and losses arising
\u00a0
from changes in fair value of equity
\u00a0
investments are recognised directly in other
comprehensive
\u00a0
income until
\u00a0
the investment
\u00a0
is disposed
\u00a0
of, at which
\u00a0
time the
\u00a0
cumulative
\u00a0
gain or loss
\u00a0
is reclassified
\u00a0
within equity
\u00a0
from other
reserves
\u00a0
to retained
\u00a0
earnings.
Employee equity benefits reserve
Share-based payments represents cost
\u00a0
charged to income statement over the vesting
\u00a0
period based on the fair value measured
\u00a0
at grant date for
equity-settled share-based
\u00a0
payments provided to employees, including key management
\u00a0
personnel, as part of their remuneration. In 2022,
\u00a0
the
Group paid NOK 27 million (did not
\u00a0
pay any bonus share in 2021)
\u00a0
related to the equity-settled
\u00a0
share-based program.
Please refer
\u00a0
to note 37
\u00a0
and chapter
\u00a0
12 in the
\u00a0
corporate
\u00a0
governance
\u00a0
section of
\u00a0
the Board
\u00a0
of Directors\u2019
\u00a0
report for
\u00a0
further details
\u00a0
on these
programmes.
Pension re-measurement
This reserve
\u00a0
includes
\u00a0
the effect
\u00a0
of re-measurement
\u00a0
of pension
\u00a0
obligations
\u00a0
arising
\u00a0
due to change
\u00a0
in assumptions,
\u00a0
such as discount
\u00a0
rate and
\u00a0
long-
term demographic
\u00a0
trends.
NOK in millions
Pension
remeasurement
Income taxes
Net pension
remeasurement
Equity as of 1 January 2021
406
( 107)
298
Other comprehensive
\u00a0
income (loss)
259
( 54)
204
Equity as of 31 December 2021
665
( 161)
503
Other comprehensive
\u00a0
income (loss)
657
( 137)
520
Equity as of 31 December 2022
1 322
( 299)
1 023
See note
\u00a0
21 for more
\u00a0
information
\u00a0
relating
\u00a0
to pension
\u00a0
obligations.
Share of equity adjustments and other comprehensive income in
\u00a0
associated companies
This reserve includes underlying adjustments to equity
\u00a0
in associated companies, such as other comprehensive
\u00a0
income, share buybacks and
transactions with non-controlling interests.
Other equity transactions
This includes
\u00a0
the decrease
\u00a0
in other reserves
\u00a0
as a result
\u00a0
of acquisition
\u00a0
and sale/cancellation
\u00a0
of treasury
\u00a0
shares and
\u00a0
the increase
\u00a0
as a result
\u00a0
of
transfers
\u00a0
from other
\u00a0
paid-in capital,
\u00a0
including
\u00a0
transfers
\u00a0
from other
\u00a0
paid-in capital
\u00a0
related to
\u00a0
cancellation
\u00a0
of treasury
\u00a0
shares. The
\u00a0
price paid
\u00a0
in excess
of the nominal
\u00a0
value of
\u00a0
the shares
\u00a0
reduces this
\u00a0
reserve.
Cumulative translation
\u00a0
differences
NOK in millions
Foreign currency
translation
Net investment
hedge
Income taxes
Net translation
differences
Equity as of 1 January 2021
1 424
(5 565)
964
(3 181)
Changes during
\u00a0
2021, excluding
\u00a0
effects of
\u00a0
disposal
(3 355)
2 447
( 538)
(1 446)
Net changes during 2021
(3 355)
2 447
( 538)
(1 446)
Equity as of 31 December 2021
(1 931)
(3 118)
426
(4 627)
Changes during
\u00a0
2022, excluding
\u00a0
effects of
\u00a0
disposal
1 695
(1 402)
308
602
Amount reclassified from other comprehensive income to
\u00a0
income
statement
\u00a0
on disposal
370
233
-
603
Net changes during 2022
2 066
(1 170)
308
1 205
Equity as of 31 December 2022
135
(4 287)
734
(3 422)
During 2022,
\u00a0
a loss of NOK 370 million was reclassified
\u00a0
from other comprehensive income to income statement
\u00a0
which mainly consisted of NOK 789
million currency
\u00a0
loss on disposal
\u00a0
of Telenor
\u00a0
Myanmar,
\u00a0
NOK 450 million
\u00a0
gain on
\u00a0
disposal
\u00a0
of Digi
\u00a0
as a subsidiary
\u00a0
and recognised
\u00a0
its 32.47%
\u00a0
share of
the associated company CelcomDigi and
\u00a0
NOK 42 million currency loss on disposal
\u00a0
of Wave Money. See note 35 for
\u00a0
more information
During 2021,
\u00a0
there was no reclassification from other comprehensive
\u00a0
income to income statement.
In 2022, the translation difference gain on net
\u00a0
investment in foreign operations was caused by
\u00a0
depreciation of the Norwegian Krone against Danish
Krone, Euro, Thai Bath, and Malaysian Ringgit. The
\u00a0
appreciation of Danish Krone by 5%, Euro
\u00a0
by 5%, Thai Bath by 7% and
\u00a0
Malaysian Ringgit by 6%
against Norwegian Krone had the most significant
\u00a0
impact on the translation difference gain.
\u00a0
In 2022, a loss of NOK 233 million was
\u00a0
reclassified from other comprehensive income to income
\u00a0
statement on net investment hedge item related
\u00a0
to
Digi disposal.
In 2021, the translation difference loss on net
\u00a0
investment in foreign operations was caused by
\u00a0
appreciation of the Norwegian Krone against all the
functional currencies of the Group\u2019s investments except
\u00a0
the Bangladeshi Taka. The depreciation of Euro by
\u00a0
5%, Swedish Krone by 7%, Thai Bath
\u00a0
by
7%, Danish Krone by 5%, Pakistani Rupee
\u00a0
by 6% and Myanmar Kyat by 23% against Norwegian
\u00a0
Krone had the most significant impact on
\u00a0
the
translation
\u00a0
difference
\u00a0
loss.
Non-controlling
\u00a0
interests
NOK in millions
Country of
incorporation
and
operation
Non-controlling
2022
Non-controlling
2021
Non-controlling
31.12.22
Non-controlling
31.12.21
Non-controlling
Non-controlling
Malaysia
999
1 227
-
686
1 136
1 196
Bangladesh
1 372
1 523
1 948
2 255
1 595
1 616
Total Access Communications
Plc (dtac)
Thailand
296
314
2 316
2 287
419
484
Others
( 2)
( 1)
( 28)
( 23)
9
-
Total
2 665
3 063
4 236
5 206
3 159
3 296
Summarised financial
\u00a0
information for
\u00a0
subsidiaries with
\u00a0
significant
\u00a0
non-controlling
\u00a0
interests
\u00a0
Summarised statement of financial position as of 31 December:
2022
2021
NOK in millions
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Current assets
-
1 155
6 849
3 251
1 010
6 189
-
16 518
40 177
14 077
15 680
40 786
Current liabilities
-
(8 876)
(12 501)
(6 318)
(8 731)
(12 517)
Non-current liabilities
-
(4 531)
(25 636)
(9 053)
(3 032)
(25 917)
Total equity
-
4 265
8 888
1 958
4 927
8 541
Equity holders
\u00a0
of Telenor
\u00a0
ASA
-
2 317
6 572
1 271
2 672
6 254
Non-controlling interests
-
1 948
2 316
686
2 255
2 287
Summarised comprehensive income information 1 January \u2013 31 December:
2022
2021
NOK in millions
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Revenues
-
15 508
22 107
-
14 464
21 878
Net income
-
3 188
960
-
3 460
979
Total comprehensive income
-
2 917
1 544
-
3 511
313
Attributable
\u00a0
to non-controlling
\u00a0
interests
-
1 372
296
-
1 523
314
Summarised cash flow information 1 January \u2013 31 December:
2022
2021
NOK in millions
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Operating activities
5 239
6 418
7 058
5 343
5 623
6 779
Investing
\u00a0
activities
(7 809)
(2 224)
(3 318)
(1 481)
(1 899)
(3 915)
Financing activities
2 123
(4 135)
(3 171)
(4 066)
(3 708)
(3 691)
Effect of exchange rate changes on cash and
cash equivalents
14
( 23)
90
( 6)
4
( 121)
Net increase/(decrease) in cash and cash
equivalents
( 433)
36
659
( 210)
19
( 947)
NOTE 28
Equity
Paid-in capital
NOK in millions,
\u00a0
except number
\u00a0
of shares
Share capital
Other paid
\u00a0
in capital
Total paid-in
\u00a0
capital
Equity as of 1 January 2021
8 397
69
-
8 466
Share buyback
-
-
-
-
-
Cancellation
\u00a0
of shares
-
-
-
-
-
Equity as of 31 December 2021
8 397
69
-
8 466
Share buyback
-
-
-
-
-
Cancellation
\u00a0
of shares
-
-
-
-
-
Equity as of 31 December 2022
8 397
69
-
8 466
Nominal value
\u00a0
per share
\u00a0
is NOK 6.
At the Extraordinary General Meeting on 26 January
\u00a0
2023, The Board of Directors authorised a new
\u00a0
share buyback program. At the same time the
company has
\u00a0
the intention
\u00a0
to enter
\u00a0
into an agreement
\u00a0
with the
\u00a0
Norwegian
\u00a0
State represented
\u00a0
by the Ministry
\u00a0
of Trade,
\u00a0
Industry and
\u00a0
Fisheries
\u00a0
to buy
back shares
\u00a0
for the purpose
\u00a0
of cancellation
\u00a0
of shares
\u00a0
and write-down
\u00a0
of share
\u00a0
capital in
\u00a0
order to
\u00a0
maintain the
\u00a0
Government
\u00a0
proportion
\u00a0
of the total
shares. The
\u00a0
Board of
\u00a0
Directors
\u00a0
is authorised
\u00a0
to acquire
\u00a0
up to 47
\u00a0
000 000 own
\u00a0
shares with
\u00a0
nominal value
\u00a0
of NOK 282
\u00a0
million which
\u00a0
corresponds
\u00a0
to
approximately 3.4% of the company\u2019s share capital.
\u00a0
The share buyback is limited to NOK 3.7
\u00a0
billion. The authorisation is valid until 31
\u00a0
December
Other reserves
NOK in millions
Net unrealised
gains/(losses)
reserve
Employee
equity bene-
fits reserve
Pension
remeasure-
ment reserve
Transactions
with non-
controlling
interests
Share of equity
other
comprehensive
income in
associated
companies
Other equity
transactions
Total other
reserves
Equity as of 1 January 2021
117
403
298
-
1 469
(24 302)
(22 014)
Other comprehensive
\u00a0
income (loss),
\u00a0
net of taxes
134
-
204
-
76
-
415
Share-based payment
-
66
-
-
-
-
66
Equity adjustments
\u00a0
in associated
\u00a0
companies
-
-
-
-
3
-
3
Equity as of 31 December 2021
251
469
503
-
1 548
(24 302)
(21 530)
Other comprehensive
\u00a0
income (loss),
\u00a0
net of taxes
157
-
520
-
46
-
723
Share-based payment
-
61
-
-
-
-
61
Other changes in other reserves during 2022
408
531
1 023
-
1 594
(24 302)
(20 746)
Net unrealised gains/losses reserve
This reserve includes unrealised gains and losses arising
\u00a0
from changes in fair value of equity
\u00a0
investments are recognised directly in other
comprehensive
\u00a0
income until
\u00a0
the investment
\u00a0
is disposed
\u00a0
of, at which
\u00a0
time the
\u00a0
cumulative
\u00a0
gain or loss
\u00a0
is reclassified
\u00a0
within equity
\u00a0
from other
reserves
\u00a0
to retained
\u00a0
earnings.
Employee equity benefits reserve
Share-based payments represents cost
\u00a0
charged to income statement over the vesting
\u00a0
period based on the fair value measured
\u00a0
at grant date for
equity-settled share-based
\u00a0
payments provided to employees, including key management
\u00a0
personnel, as part of their remuneration. In 2022,
\u00a0
the
Group paid NOK 27 million (did not
\u00a0
pay any bonus share in 2021)
\u00a0
related to the equity-settled
\u00a0
share-based program.
Please refer
\u00a0
to note 37
\u00a0
and chapter
\u00a0
12 in the
\u00a0
corporate
\u00a0
governance
\u00a0
section of
\u00a0
the Board
\u00a0
of Directors\u2019
\u00a0
report for
\u00a0
further details
\u00a0
on these
programmes.
Pension re-measurement
This reserve
\u00a0
includes
\u00a0
the effect
\u00a0
of re-measurement
\u00a0
of pension
\u00a0
obligations
\u00a0
arising
\u00a0
due to change
\u00a0
in assumptions,
\u00a0
such as discount
\u00a0
rate and
\u00a0
long-
term demographic
\u00a0
trends.
NOK in millions
Pension
remeasurement
Income taxes
Net pension
remeasurement
Equity as of 1 January 2021
406
( 107)
298
Other comprehensive
\u00a0
income (loss)
259
( 54)
204
Equity as of 31 December 2021
665
( 161)
503
Other comprehensive
\u00a0
income (loss)
657
( 137)
520
Equity as of 31 December 2022
1 322
( 299)
1 023
See note
\u00a0
21 for more
\u00a0
information
\u00a0
relating
\u00a0
to pension
\u00a0
obligations.
Share of equity adjustments and other comprehensive income in
\u00a0
associated companies
This reserve includes underlying adjustments to equity
\u00a0
in associated companies, such as other comprehensive
\u00a0
income, share buybacks and
transactions with non-controlling interests.
Other equity transactions
This includes
\u00a0
the decrease
\u00a0
in other reserves
\u00a0
as a result
\u00a0
of acquisition
\u00a0
and sale/cancellation
\u00a0
of treasury
\u00a0
shares and
\u00a0
the increase
\u00a0
as a result
\u00a0
of
transfers
\u00a0
from other
\u00a0
paid-in capital,
\u00a0
including
\u00a0
transfers
\u00a0
from other
\u00a0
paid-in capital
\u00a0
related to
\u00a0
cancellation
\u00a0
of treasury
\u00a0
shares. The
\u00a0
price paid
\u00a0
in excess
of the nominal
\u00a0
value of
\u00a0
the shares
\u00a0
reduces this
\u00a0
reserve.
Cumulative translation
\u00a0
differences
NOK in millions
Foreign currency
translation
Net investment
hedge
Income taxes
Net translation
differences
Equity as of 1 January 2021
1 424
(5 565)
964
(3 181)
Changes during
\u00a0
2021, excluding
\u00a0
effects of
\u00a0
disposal
(3 355)
2 447
( 538)
(1 446)
Net changes during 2021
(3 355)
2 447
( 538)
(1 446)
Equity as of 31 December 2021
(1 931)
(3 118)
426
(4 627)
Changes during
\u00a0
2022, excluding
\u00a0
effects of
\u00a0
disposal
1 695
(1 402)
308
602
Amount reclassified from other comprehensive income to
\u00a0
income
statement
\u00a0
on disposal
370
233
-
603
Net changes during 2022
2 066
(1 170)
308
1 205
Equity as of 31 December 2022
135
(4 287)
734
(3 422)
During 2022,
\u00a0
a loss of NOK 370 million was reclassified
\u00a0
from other comprehensive income to income statement
\u00a0
which mainly consisted of NOK 789
million currency
\u00a0
loss on disposal
\u00a0
of Telenor
\u00a0
Myanmar,
\u00a0
NOK 450 million
\u00a0
gain on
\u00a0
disposal
\u00a0
of Digi
\u00a0
as a subsidiary
\u00a0
and recognised
\u00a0
its 32.47%
\u00a0
share of
the associated company CelcomDigi and
\u00a0
NOK 42 million currency loss on disposal
\u00a0
of Wave Money. See note 35 for
\u00a0
more information
During 2021,
\u00a0
there was no reclassification from other comprehensive
\u00a0
income to income statement.
In 2022, the translation difference gain on net
\u00a0
investment in foreign operations was caused by
\u00a0
depreciation of the Norwegian Krone against Danish
Krone, Euro, Thai Bath, and Malaysian Ringgit. The
\u00a0
appreciation of Danish Krone by 5%, Euro
\u00a0
by 5%, Thai Bath by 7% and
\u00a0
Malaysian Ringgit by 6%
against Norwegian Krone had the most significant
\u00a0
impact on the translation difference gain.
\u00a0
In 2022, a loss of NOK 233 million was
\u00a0
reclassified from other comprehensive income to income
\u00a0
statement on net investment hedge item related
\u00a0
to
Digi disposal.
In 2021, the translation difference loss on net
\u00a0
investment in foreign operations was caused by
\u00a0
appreciation of the Norwegian Krone against all the
functional currencies of the Group\u2019s investments except
\u00a0
the Bangladeshi Taka. The depreciation of Euro by
\u00a0
5%, Swedish Krone by 7%, Thai Bath
\u00a0
by
7%, Danish Krone by 5%, Pakistani Rupee
\u00a0
by 6% and Myanmar Kyat by 23% against Norwegian
\u00a0
Krone had the most significant impact on
\u00a0
the
translation
\u00a0
difference
\u00a0
loss.
Non-controlling
\u00a0
interests
NOK in millions
Country of
incorporation
and
operation
Non-controlling
2022
Non-controlling
2021
Non-controlling
31.12.22
Non-controlling
31.12.21
Non-controlling
Non-controlling
Malaysia
999
1 227
-
686
1 136
1 196
Bangladesh
1 372
1 523
1 948
2 255
1 595
1 616
Total Access Communications
Plc (dtac)
Thailand
296
314
2 316
2 287
419
484
Others
( 2)
( 1)
( 28)
( 23)
9
-
Total
2 665
3 063
4 236
5 206
3 159
3 296
Summarised financial
\u00a0
information for
\u00a0
subsidiaries with
\u00a0
significant
\u00a0
non-controlling
\u00a0
interests
\u00a0
Summarised statement of financial position as of 31 December:
2022
2021
NOK in millions
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Current assets
-
1 155
6 849
3 251
1 010
6 189
-
16 518
40 177
14 077
15 680
40 786
Current liabilities
-
(8 876)
(12 501)
(6 318)
(8 731)
(12 517)
Non-current liabilities
-
(4 531)
(25 636)
(9 053)
(3 032)
(25 917)
Total equity
-
4 265
8 888
1 958
4 927
8 541
Equity holders
\u00a0
of Telenor
\u00a0
ASA
-
2 317
6 572
1 271
2 672
6 254
Non-controlling interests
-
1 948
2 316
686
2 255
2 287
Summarised comprehensive income information 1 January \u2013 31 December:
2022
2021
NOK in millions
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Revenues
-
15 508
22 107
-
14 464
21 878
Net income
-
3 188
960
-
3 460
979
Total comprehensive income
-
2 917
1 544
-
3 511
313
Attributable
\u00a0
to non-controlling
\u00a0
interests
-
1 372
296
-
1 523
314
Summarised cash flow information 1 January \u2013 31 December:
2022
2021
NOK in millions
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Operating activities
5 239
6 418
7 058
5 343
5 623
6 779
Investing
\u00a0
activities
(7 809)
(2 224)
(3 318)
(1 481)
(1 899)
(3 915)
Financing activities
2 123
(4 135)
(3 171)
(4 066)
(3 708)
(3 691)
Effect of exchange rate changes on cash and
cash equivalents
14
( 23)
90
( 6)
4
( 121)
Net increase/(decrease) in cash and cash
equivalents
( 433)
36
659
( 210)
19
( 947)
NOTE 39
Share information and ownership
Share information
As of 31 December 2022, Telenor ASA had a
\u00a0
share capital of NOK 8 396 748
\u00a0
198 divided into 1 399 458 033 ordinary
\u00a0
shares with a nominal value of
NOK 6 each. All ordinary Telenor shares have
\u00a0
equal voting rights and the right to
\u00a0
receive dividends. As of 31 December 2022 and 2021
\u00a0
the company
held no treasury shares.
Shareholders
As of 31 December 2022, Telenor ASA had about 61,300
\u00a0
registered shareholders, compared to about 57,100 as
\u00a0
of 31 December 2021.
\u00a0
The 20 largest shareholders as of 31 December 2022
\u00a0
from the shareholder register
1)
Name of shareholders
%
1
Ministry of Trade, Industry and Fisheries, Kingdom
\u00a0
of Norway
\u00a0
755 220 420
53.97
2
Folketrygdfondet
62 579 157
4.47
3
DNB Asset
\u00a0
Management
\u00a0
AS
29 014 798
2.07
4
26 948 952
1.93
5
BlackRock
\u00a0
Institutional
\u00a0
Trust Company,
\u00a0
N.A.
24 298 544
1.74
6
The Vanguard
\u00a0
Group, Inc.
22 474 455
1.61
7
Caisse de Depot et Placement du Quebec
18 634 411
1.33
8
Storebrand Kapitalforvaltning AS
18 235 048
1.30
9
Amundi Asset
\u00a0
Management,
\u00a0
SAS
14 369 399
1.03
10
KLP Fondsforvaltning AS
13 076 230
0.93
11
BlackRock Advisors (UK) Limited
10 777 743
0.77
12
Pyrford International Limited
10 424 701
0.74
13
State Street
\u00a0
Global Advisors
\u00a0
(US)
9 100 156
0.65
14
Handelsbanken Kapitalf\u00f6rvaltning AB
8 534 582
0.61
15
Danske Invest Asset Management AS
8 481 555
0.61
16
Danske Bank Asset Management
7 009 921
0.50
17
6 723 481
0.48
18
Fidelity
\u00a0
International
6 509 442
0.47
19
Legal & General Investment Management Ltd.
6 264 538
0.45
20
APG Asset
\u00a0
Management
\u00a0
N.V.
6 138 212
0.44
Total held by 20 largest shareholders
76.10
Total all Telenor shares
100.00
The 20 largest shareholders as of 31 December 2022
\u00a0
beneficial ownership
2)
Name of shareholders
%
1
Ministry of Trade, Industry and Fisheries, Kingdom
\u00a0
of Norway
\u00a0
755 220 420
53.97
2
FOLKETRYGDFONDET
62 579 157
4.47
3
State Street
\u00a0
Bank and
\u00a0
Trust Comp
28 908 338
2.07
4
State Street
\u00a0
Bank and
\u00a0
Trust Comp
27 135 763
1.94
5
State Street
\u00a0
Bank and
\u00a0
Trust Comp
24 842 271
1.78
6
12 730 679
0.91
7
State Street
\u00a0
Bank and
\u00a0
Trust Comp
12 679 695
0.91
8
State Street
\u00a0
Bank and
\u00a0
Trust Comp
12 147 338
0.87
9
CLEARSTREAM
\u00a0
BANKING S.A.
10 568 174
0.76
10
9 718 372
0.69
11
State Street
\u00a0
Bank and
\u00a0
Trust Comp
7 496 236
0.54
12
State Street
\u00a0
Bank and
\u00a0
Trust Comp
7 435 292
0.53
13
CACEIS Bank
7 028 900
0.50
14
VERDIPAPIRFONDET KLP AKSJENORGE IN
6 572 343
0.47
15
VERDIPAPIRFONDET DNB TEKNOLOGI
6 216 179
0.44
16
VERDIPAPIRFONDET STOREBRAND NORGE
6 093 235
0.44
17
VPF DNB
\u00a0
AM NORSKE
\u00a0
AKSJER
5 827 471
0.42
18
SIX SIS AG
5 620 721
0.40
19
The Bank of New York Mellon
5 287 074
0.38
20
Soci\u00e9t\u00e9 G\u00e9n\u00e9rale
5 037 420
0.36
Total held by 20 largest shareholders
72.85
Total all Telenor shares
100.00
1)
Source: VPS share register
2)
The data is provided by Nasdaq Advisory Services
\u00a0
and is obtained through an analysis of beneficial
\u00a0
ownership and fund manager information provided
\u00a0
in
replies to disclosure of ownership notices issued to
\u00a0
all custodians on the Telenor VPS share register.
\u00a0
Every reasonable effort has been made to verify
\u00a0
the data;
however, neither Telenor nor Nasdaq Advisory Services
\u00a0
can guarantee the accuracy of the analysis.
NOTE 28
Equity
Paid-in capital
NOK in millions,
\u00a0
except number
\u00a0
of shares
Share capital
Other paid
\u00a0
in capital
Total paid-in
\u00a0
capital
Equity as of 1 January 2021
8 397
69
-
8 466
Share buyback
-
-
-
-
-
Cancellation
\u00a0
of shares
-
-
-
-
-
Equity as of 31 December 2021
8 397
69
-
8 466
Share buyback
-
-
-
-
-
Cancellation
\u00a0
of shares
-
-
-
-
-
Equity as of 31 December 2022
8 397
69
-
8 466
Nominal value
\u00a0
per share
\u00a0
is NOK 6.
At the Extraordinary General Meeting on 26 January
\u00a0
2023, The Board of Directors authorised a new
\u00a0
share buyback program. At the same time the
company has
\u00a0
the intention
\u00a0
to enter
\u00a0
into an agreement
\u00a0
with the
\u00a0
Norwegian
\u00a0
State represented
\u00a0
by the Ministry
\u00a0
of Trade,
\u00a0
Industry and
\u00a0
Fisheries
\u00a0
to buy
back shares
\u00a0
for the purpose
\u00a0
of cancellation
\u00a0
of shares
\u00a0
and write-down
\u00a0
of share
\u00a0
capital in
\u00a0
order to
\u00a0
maintain the
\u00a0
Government
\u00a0
proportion
\u00a0
of the total
shares. The
\u00a0
Board of
\u00a0
Directors
\u00a0
is authorised
\u00a0
to acquire
\u00a0
up to 47
\u00a0
000 000 own
\u00a0
shares with
\u00a0
nominal value
\u00a0
of NOK 282
\u00a0
million which
\u00a0
corresponds
\u00a0
to
approximately 3.4% of the company\u2019s share capital.
\u00a0
The share buyback is limited to NOK 3.7
\u00a0
billion. The authorisation is valid until 31
\u00a0
December
Other reserves
NOK in millions
Net unrealised
gains/(losses)
reserve
Employee
equity bene-
fits reserve
Pension
remeasure-
ment reserve
Transactions
with non-
controlling
interests
Share of equity
other
comprehensive
income in
associated
companies
Other equity
transactions
Total other
reserves
Equity as of 1 January 2021
117
403
298
-
1 469
(24 302)
(22 014)
Other comprehensive
\u00a0
income (loss),
\u00a0
net of taxes
134
-
204
-
76
-
415
Share-based payment
-
66
-
-
-
-
66
Equity adjustments
\u00a0
in associated
\u00a0
companies
-
-
-
-
3
-
3
Equity as of 31 December 2021
251
469
503
-
1 548
(24 302)
(21 530)
Other comprehensive
\u00a0
income (loss),
\u00a0
net of taxes
157
-
520
-
46
-
723
Share-based payment
-
61
-
-
-
-
61
Other changes in other reserves during 2022
408
531
1 023
-
1 594
(24 302)
(20 746)
Net unrealised gains/losses reserve
This reserve includes unrealised gains and losses arising
\u00a0
from changes in fair value of equity
\u00a0
investments are recognised directly in other
comprehensive
\u00a0
income until
\u00a0
the investment
\u00a0
is disposed
\u00a0
of, at which
\u00a0
time the
\u00a0
cumulative
\u00a0
gain or loss
\u00a0
is reclassified
\u00a0
within equity
\u00a0
from other
reserves
\u00a0
to retained
\u00a0
earnings.
Employee equity benefits reserve
Share-based payments represents cost
\u00a0
charged to income statement over the vesting
\u00a0
period based on the fair value measured
\u00a0
at grant date for
equity-settled share-based
\u00a0
payments provided to employees, including key management
\u00a0
personnel, as part of their remuneration. In 2022,
\u00a0
the
Group paid NOK 27 million (did not
\u00a0
pay any bonus share in 2021)
\u00a0
related to the equity-settled
\u00a0
share-based program.
Please refer
\u00a0
to note 37
\u00a0
and chapter
\u00a0
12 in the
\u00a0
corporate
\u00a0
governance
\u00a0
section of
\u00a0
the Board
\u00a0
of Directors\u2019
\u00a0
report for
\u00a0
further details
\u00a0
on these
programmes.
Pension re-measurement
This reserve
\u00a0
includes
\u00a0
the effect
\u00a0
of re-measurement
\u00a0
of pension
\u00a0
obligations
\u00a0
arising
\u00a0
due to change
\u00a0
in assumptions,
\u00a0
such as discount
\u00a0
rate and
\u00a0
long-
term demographic
\u00a0
trends.
NOK in millions
Pension
remeasurement
Income taxes
Net pension
remeasurement
Equity as of 1 January 2021
406
( 107)
298
Other comprehensive
\u00a0
income (loss)
259
( 54)
204
Equity as of 31 December 2021
665
( 161)
503
Other comprehensive
\u00a0
income (loss)
657
( 137)
520
Equity as of 31 December 2022
1 322
( 299)
1 023
See note
\u00a0
21 for more
\u00a0
information
\u00a0
relating
\u00a0
to pension
\u00a0
obligations.
Share of equity adjustments and other comprehensive income in
\u00a0
associated companies
This reserve includes underlying adjustments to equity
\u00a0
in associated companies, such as other comprehensive
\u00a0
income, share buybacks and
transactions with non-controlling interests.
Other equity transactions
This includes
\u00a0
the decrease
\u00a0
in other reserves
\u00a0
as a result
\u00a0
of acquisition
\u00a0
and sale/cancellation
\u00a0
of treasury
\u00a0
shares and
\u00a0
the increase
\u00a0
as a result
\u00a0
of
transfers
\u00a0
from other
\u00a0
paid-in capital,
\u00a0
including
\u00a0
transfers
\u00a0
from other
\u00a0
paid-in capital
\u00a0
related to
\u00a0
cancellation
\u00a0
of treasury
\u00a0
shares. The
\u00a0
price paid
\u00a0
in excess
of the nominal
\u00a0
value of
\u00a0
the shares
\u00a0
reduces this
\u00a0
reserve.
Cumulative translation
\u00a0
differences
NOK in millions
Foreign currency
translation
Net investment
hedge
Income taxes
Net translation
differences
Equity as of 1 January 2021
1 424
(5 565)
964
(3 181)
Changes during
\u00a0
2021, excluding
\u00a0
effects of
\u00a0
disposal
(3 355)
2 447
( 538)
(1 446)
Net changes during 2021
(3 355)
2 447
( 538)
(1 446)
Equity as of 31 December 2021
(1 931)
(3 118)
426
(4 627)
Changes during
\u00a0
2022, excluding
\u00a0
effects of
\u00a0
disposal
1 695
(1 402)
308
602
Amount reclassified from other comprehensive income to
\u00a0
income
statement
\u00a0
on disposal
370
233
-
603
Net changes during 2022
2 066
(1 170)
308
1 205
Equity as of 31 December 2022
135
(4 287)
734
(3 422)
During 2022,
\u00a0
a loss of NOK 370 million was reclassified
\u00a0
from other comprehensive income to income statement
\u00a0
which mainly consisted of NOK 789
million currency
\u00a0
loss on disposal
\u00a0
of Telenor
\u00a0
Myanmar,
\u00a0
NOK 450 million
\u00a0
gain on
\u00a0
disposal
\u00a0
of Digi
\u00a0
as a subsidiary
\u00a0
and recognised
\u00a0
its 32.47%
\u00a0
share of
the associated company CelcomDigi and
\u00a0
NOK 42 million currency loss on disposal
\u00a0
of Wave Money. See note 35 for
\u00a0
more information
During 2021,
\u00a0
there was no reclassification from other comprehensive
\u00a0
income to income statement.
In 2022, the translation difference gain on net
\u00a0
investment in foreign operations was caused by
\u00a0
depreciation of the Norwegian Krone against Danish
Krone, Euro, Thai Bath, and Malaysian Ringgit. The
\u00a0
appreciation of Danish Krone by 5%, Euro
\u00a0
by 5%, Thai Bath by 7% and
\u00a0
Malaysian Ringgit by 6%
against Norwegian Krone had the most significant
\u00a0
impact on the translation difference gain.
\u00a0
In 2022, a loss of NOK 233 million was
\u00a0
reclassified from other comprehensive income to income
\u00a0
statement on net investment hedge item related
\u00a0
to
Digi disposal.
In 2021, the translation difference loss on net
\u00a0
investment in foreign operations was caused by
\u00a0
appreciation of the Norwegian Krone against all the
functional currencies of the Group\u2019s investments except
\u00a0
the Bangladeshi Taka. The depreciation of Euro by
\u00a0
5%, Swedish Krone by 7%, Thai Bath
\u00a0
by
7%, Danish Krone by 5%, Pakistani Rupee
\u00a0
by 6% and Myanmar Kyat by 23% against Norwegian
\u00a0
Krone had the most significant impact on
\u00a0
the
translation
\u00a0
difference
\u00a0
loss.
Non-controlling
\u00a0
interests
NOK in millions
Country of
incorporation
and
operation
Non-controlling
2022
Non-controlling
2021
Non-controlling
31.12.22
Non-controlling
31.12.21
Non-controlling
Non-controlling
Malaysia
999
1 227
-
686
1 136
1 196
Bangladesh
1 372
1 523
1 948
2 255
1 595
1 616
Total Access Communications
Plc (dtac)
Thailand
296
314
2 316
2 287
419
484
Others
( 2)
( 1)
( 28)
( 23)
9
-
Total
2 665
3 063
4 236
5 206
3 159
3 296
Summarised financial
\u00a0
information for
\u00a0
subsidiaries with
\u00a0
significant
\u00a0
non-controlling
\u00a0
interests
\u00a0
Summarised statement of financial position as of 31 December:
2022
2021
NOK in millions
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Current assets
-
1 155
6 849
3 251
1 010
6 189
-
16 518
40 177
14 077
15 680
40 786
Current liabilities
-
(8 876)
(12 501)
(6 318)
(8 731)
(12 517)
Non-current liabilities
-
(4 531)
(25 636)
(9 053)
(3 032)
(25 917)
Total equity
-
4 265
8 888
1 958
4 927
8 541
Equity holders
\u00a0
of Telenor
\u00a0
ASA
-
2 317
6 572
1 271
2 672
6 254
Non-controlling interests
-
1 948
2 316
686
2 255
2 287
Summarised comprehensive income information 1 January \u2013 31 December:
2022
2021
NOK in millions
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Revenues
-
15 508
22 107
-
14 464
21 878
Net income
-
3 188
960
-
3 460
979
Total comprehensive income
-
2 917
1 544
-
3 511
313
Attributable
\u00a0
to non-controlling
\u00a0
interests
-
1 372
296
-
1 523
314
Summarised cash flow information 1 January \u2013 31 December:
2022
2021
NOK in millions
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Digi.Com Bhd
Total Access
Communications
Plc (dtac)
Operating activities
5 239
6 418
7 058
5 343
5 623
6 779
Investing
\u00a0
activities
(7 809)
(2 224)
(3 318)
(1 481)
(1 899)
(3 915)
Financing activities
2 123
(4 135)
(3 171)
(4 066)
(3 708)
(3 691)
Effect of exchange rate changes on cash and
cash equivalents
14
( 23)
90
( 6)
4
( 121)
Net increase/(decrease) in cash and cash
equivalents
( 433)
36
659
( 210)
19
( 947)
NOTE 30
Interest-bearing liabilities
The non-current debt in Telenor mainly consists of bonds issued under
\u00a0
the EMTN programme (Euro Medium Term
Note), bonds issued in other markets and bank loans. Forward contracts
\u00a0
and cross currency swaps are used to
hedge foreign exchange rate risk for certain assets.
\u00a0
Accounting policies
Interest-bearing
\u00a0
liabilities
\u00a0
are initially
\u00a0
measured
\u00a0
at fair value
\u00a0
net of transaction
\u00a0
costs and
\u00a0
are subsequently
\u00a0
measured
\u00a0
at amortised
\u00a0
cost using
\u00a0
the
effective
\u00a0
interest-rate
\u00a0
method (FLAC).
\u00a0
In addition,
\u00a0
where fair
\u00a0
value hedge
\u00a0
accounting
\u00a0
is applied
\u00a0
the hedged
\u00a0
liabilities
\u00a0
are adjusted
\u00a0
for gains
\u00a0
and
losses attributable
\u00a0
to the risk
\u00a0
being hedged.
\u00a0
On extinguishment
\u00a0
of debt,
\u00a0
in whole
\u00a0
or in part,
\u00a0
the difference
\u00a0
between
\u00a0
the carrying
\u00a0
amount of
\u00a0
the
liability and the consideration paid is recognised
\u00a0
in the income statement.
Interest-bearing
\u00a0
liabilities
2022
2021
NOK in millions
Current interest-
bearing liabilities
Non-current
interest-bearing
liabilities
Total
Current interest-
bearing liabilities
Non-current
interest-bearing
liabilities
Total
Interest-bearing liabilities measured at amortised cost
Bank loans
1 586
2 349
3 935
2 783
3 331
6 115
Bonds
6 969
76 529
83 498
6 423
83 781
90 204
Other liabilities
604
194
798
70
579
648
Interest-bearing liabilities measured at fair value
Fair value hedge instruments
10
3 652
3 662
-
120
120
Total interest-bearing
\u00a0
liabilities
9 169
82 724
91 893
9 276
87 811
97 087
Fair value of debt
1)
99 389
99 389
Of which fair value hierarchy level 1
2)
92 421
92 421
Of which fair value hierarchy level 2
2)
6 968
6 968
1)
Excluding lease liabilities and licence obligations.
\u00a0
2)
For information about the fair value hierarchy for valuation
\u00a0
of financial instruments, see note 32.
\u00a0
Non-current
\u00a0
interest-bearing
\u00a0
liabilities
2022
2021
NOK in millions
Currency
Debt before
\u00a0
the
\u00a0
swaps
Debt adjusted
\u00a0
for
\u00a0
currency swaps
2)
Debt before
\u00a0
the
\u00a0
swaps
Debt adjusted
\u00a0
for
\u00a0
currency swaps
2)
EUR
60 714
35 496
62 981
39 014
NOK
1)
-
(2 735)
-
(2 735)
SEK
4 248
15 670
4 376
16 152
USD
-
13 612
-
15 540
Total Telenor ASA
64 962
62 044
67 357
67 970
DNA - Finland
EUR
2 601
2 601
2 454
2 454
dtac - Thailand
THB
14 967
14 967
13 558
13 558
Digi - Malaysia
MYR
-
-
3 863
3 863
Other non-current interest-bearing
\u00a0
liabilities
194
194
578
578
Total subsidiaries
17 762
17 762
20 454
20 454
Total non-current interest-bearing liabilities
82 724
79 805
87 811
88 424
1)
Telenor ASA\u2019s debt position in Norwegian Kroner is
\u00a0
a net asset position when including currency swaps.
\u00a0
2)
Debt adjusted for currency swaps includes financial instruments
\u00a0
that are not classified as interest-bearing liabilities
\u00a0
in the statement of financial position.
Current interest-bearing
\u00a0
liabilities
2022
2021
NOK in millions
Currency
Debt before
\u00a0
the
\u00a0
swaps
Debt adjusted
\u00a0
for
\u00a0
currency swaps
2)
Debt before
\u00a0
the
\u00a0
swaps
Debt adjusted
\u00a0
for
\u00a0
currency swaps
2)
Company
NOK
1)
-
3 335
-
(558)
EUR
1)
5 263
963
4 992
(658)
SEK
-
236
-
351
MYR
-
2 224
-
2 106
THB
-
3 624
-
5 093
USD
1)
-
(4 782)
-
(1 000)
Total Telenor ASA
5 263
5 599
4 992
5 333
dtac - Thailand
THB
2 570
2 570
2 121
2 121
Digi - Malaysia
MYR
-
-
1 460
1 460
Grameenphone - Bangladesh
BDT
481
481
563
563
Pakistan
PKR
232
232
81
81
Other current interest-bearing
\u00a0
liabilities
623
623
58
58
Total subsidiaries
3 906
3 906
4 284
4 284
Total current interest-bearing liabilities
9 169
9 505
9 276
9 617
1)
Telenor ASA\u2019s debt positions in US Dollars as of 31
\u00a0
December 2022 and Norwegian Kroner, US Dollars
\u00a0
and Euro as of 31 December 2021, are net asset
\u00a0
positions
when including currency swaps.
\u00a0
2)
Debt adjusted for currency swaps includes financial instruments
\u00a0
that are not classified as interest-bearing liabilities
\u00a0
in the statement of financial position.
Debt issued
\u00a0
under Telenor
\u00a0
ASA\u2019s EMTN
\u00a0
programme
\u00a0
is based
\u00a0
on documentation
\u00a0
that is
\u00a0
commonly
\u00a0
used for
\u00a0
investment
\u00a0
grade issuers
\u00a0
in the
Eurobond market. This documentation contains provisions restricting
\u00a0
the pledge of assets to secure future
\u00a0
borrowings without granting a similar
secured status to the existing lenders (negative
\u00a0
pledges) and contains covenants limiting disposals of assets.
Bonds issued under the EMTN programme are
\u00a0
subject to a Change of Control Clause.
\u00a0
Such Change of Control shall be deemed to
\u00a0
have occurred if
a person
\u00a0
or entity,
\u00a0
other than
\u00a0
the Kingdom
\u00a0
of Norway,
\u00a0
directly
\u00a0
or indirectly
\u00a0
owns or acquires
\u00a0
more than
\u00a0
50% of the
\u00a0
issued ordinary
\u00a0
share capital
\u00a0
of
Telenor
\u00a0
ASA. If such
\u00a0
Change of
\u00a0
Control leads
\u00a0
to a downgrade
\u00a0
below investment
\u00a0
grade rating,
\u00a0
the holder
\u00a0
of such bonds
\u00a0
can require
\u00a0
Telenor ASA
\u00a0
to
redeem the
\u00a0
principal
\u00a0
amount together
\u00a0
with accrued
\u00a0
interest.
\u00a0
The full
\u00a0
definition
\u00a0
of this Change
\u00a0
of Control
\u00a0
Clause is
\u00a0
described
\u00a0
in the Final
\u00a0
Terms for
each specific bond issue.
Telenor
\u00a0
ASA did not
\u00a0
issue bonds
\u00a0
under the
\u00a0
EMTN programme
\u00a0
in 2022.
\u00a0
All outstanding
\u00a0
debt issued
\u00a0
by Telenor
\u00a0
ASA is unsecured.
Furthermore, debt in dtac is mainly comprised of
\u00a0
issued bonds (NOK 14.3 billion) and debt
\u00a0
to financial institutions (NOK 3.2 billion).
The interest-bearing
\u00a0
liabilities in subsidiaries are generally not guaranteed by
\u00a0
Telenor ASA and are subject to standard
\u00a0
financial covenants, some of
which limit
\u00a0
the ability
\u00a0
to transfer
\u00a0
funds to Telenor
\u00a0
ASA in the
\u00a0
form of
\u00a0
dividends
\u00a0
or loans.
\u00a0
Refer to note 31 Capital and financial risk
\u00a0
management for further information about capital management,
\u00a0
maturity profile of the interest-bearing
liabilities,
\u00a0
liquidity
\u00a0
risk, exchange
\u00a0
rate risk,
\u00a0
interest rate
\u00a0
risk and
\u00a0
derivatives.
Accounting policies
Interest-bearing
\u00a0
liabilities
\u00a0
are initially
\u00a0
measured
\u00a0
at fair value
\u00a0
net of transaction
\u00a0
costs and
\u00a0
are subsequently
\u00a0
measured
\u00a0
at amortised
\u00a0
cost using
\u00a0
the
effective
\u00a0
interest-rate
\u00a0
method (FLAC).
\u00a0
In addition,
\u00a0
where fair
\u00a0
value hedge
\u00a0
accounting
\u00a0
is applied
\u00a0
the hedged
\u00a0
liabilities
\u00a0
are adjusted
\u00a0
for gains
\u00a0
and
losses attributable
\u00a0
to the risk
\u00a0
being hedged.
\u00a0
On extinguishment
\u00a0
of debt,
\u00a0
in whole
\u00a0
or in part,
\u00a0
the difference
\u00a0
between
\u00a0
the carrying
\u00a0
amount of
\u00a0
the
liability and the consideration paid is recognised
\u00a0
in the income statement.
NOTE 31
Capital and financial risk management
The objectives and policies for capital and risk management
\u00a0
are described in this note, in addition to exposure and
sensitivity for financial risks such as liquidity risk, interest
\u00a0
rate risk, foreign exchange risk and credit risk. Telenor
uses various types of derivatives to hedge such exposure.
\u00a0
Accounting policies
Hedge accounting is applied for fair value
\u00a0
hedges and hedges of net investments in foreign
\u00a0
operations when the hedging criteria are met.
\u00a0
For fair
value
\u00a0
hedges, the carrying amount of the hedged
\u00a0
item is adjusted for gains and losses attributable
\u00a0
to the risk being hedged. The derivative is also
measured at fair value, and gains and losses
\u00a0
from both the hedging instrument and the hedged
\u00a0
item are recognised in the income statement.
Hedge effectiveness
\u00a0
is assessed
\u00a0
on an ongoing
\u00a0
basis, and
\u00a0
hedge accounting
\u00a0
is discontinued
\u00a0
if the hedge
\u00a0
no longer
\u00a0
meets the
\u00a0
hedge accounting
criteria.
\u00a0
If the hedged
\u00a0
item still
\u00a0
exists and
\u00a0
is not sold,
\u00a0
the fair
\u00a0
value adjustment
\u00a0
to the hedged
\u00a0
item attributable
\u00a0
to the risk
\u00a0
being hedged
\u00a0
at de-
designation
\u00a0
will be
\u00a0
amortised
\u00a0
in the income
\u00a0
statement
\u00a0
over the
\u00a0
remaining
\u00a0
time to maturity.
\u00a0
A hedge
\u00a0
of a net investment
\u00a0
in a foreign
\u00a0
operation
\u00a0
is accounted
\u00a0
for in a
\u00a0
similar way
\u00a0
as a cash
\u00a0
flow hedge.
\u00a0
Foreign exchange
\u00a0
gains or
\u00a0
losses on
\u00a0
the
hedging instrument relating to the effective portion of
\u00a0
the hedge are recognised directly in other
\u00a0
comprehensive income while any foreign
exchange gains or losses relating to the
\u00a0
ineffective portion are recognised in the income statement.
\u00a0
On disposal of the foreign entity, the
cumulative foreign exchange gains or losses recognised in
\u00a0
other comprehensive income is reclassified to the
\u00a0
income statement.
Refer to
\u00a0
note 27 Financial
\u00a0
assets and
\u00a0
liabilities
\u00a0
for further
\u00a0
information
\u00a0
on accounting
\u00a0
policies
\u00a0
for derivatives.
.
In recent
\u00a0
years, Telenor
\u00a0
has measured
\u00a0
leverage
\u00a0
as the ratio
\u00a0
of Net debt
\u00a0
to EBITDA
\u00a0
before other
\u00a0
items. Following
\u00a0
the structural
\u00a0
changes in
\u00a0
the
portfolio,
\u00a0
and triggered
\u00a0
by closing
\u00a0
of the merger
\u00a0
in Malaysia,
\u00a0
Telenor measures
\u00a0
the leverage
\u00a0
from 2022
\u00a0
as the ratio
\u00a0
of Net debt
\u00a0
to EBITDA
\u00a0
before
other items and dividends from associated companies
\u00a0
and joint ventures. Telenor aims to maintain
\u00a0
a solid balance sheet through
\u00a0
keeping leverage
ratio in the range of 1.8x to
\u00a0
2.3x maintain financial flexibility and ensure cost efficient
\u00a0
funding (see page 180 for alternative performance measures).
As of 31 December 2022,
\u00a0
the reported leverage ratio was 2.2x
\u00a0
(2.1x
\u00a0
as of 31 December 2021).
\u00a0
The targeted capital structure provides a good
\u00a0
balance
between shareholder return and a solid balance
\u00a0
sheet with stable access to global debt markets,
\u00a0
while also supporting Telenor\u2019s strategic priorities.
As of 31 December 2022, Telenor ASA\u2019s long-term credit
\u00a0
rating was \u201cBaa1/stable outlook\u201d
\u00a0
by Moody\u2019s Investors Service and \u201cA-/stable outlook\u201d
\u00a0
by
Standard & Poor\u2019s (S&P). During 2022, Moody\u2019s changed
\u00a0
their rating and outlook from \u201cA3/negative watch\u201d
\u00a0
to \u201cBaa1/stable outlook\u201d, while S&P\u2019s
rating and outlook were unchanged throughout
\u00a0
the year.
\u00a0
Key elements
\u00a0
of the Group\u2019s
\u00a0
capital
\u00a0
structure
\u00a0
include
\u00a0
interest-bearing
\u00a0
debt as
\u00a0
disclosed
\u00a0
in note 30,
\u00a0
cash and cash
\u00a0
equivalents
\u00a0
as disclosed
\u00a0
in note
20 and equity
\u00a0
attributable
\u00a0
to the shareholders
\u00a0
of Telenor
\u00a0
ASA as presented
\u00a0
in the consolidated
\u00a0
statement
\u00a0
of changes
\u00a0
in equity
\u00a0
and in note
\u00a0
28.
\u00a0
In order
\u00a0
to adjust
\u00a0
the capital
\u00a0
structure,
\u00a0
the Group
\u00a0
may acquire
\u00a0
or sell own
\u00a0
shares, distribute
\u00a0
dividends
\u00a0
to shareholders,
\u00a0
return capital
\u00a0
to
shareholders or issue new shares. In 2022, Telenor\u2019s
\u00a0
shareholder remuneration via dividend was NOK 13.0 billion
\u00a0
comprised of ordinary dividends
paid out in June 2022 (NOK 5.00 per
\u00a0
share) and October 2022 (NOK 4.30 per share).
\u00a0
For the financial
\u00a0
year 2022,
\u00a0
the Telenor
\u00a0
Board of
\u00a0
Directors
\u00a0
will propose
\u00a0
an ordinary
\u00a0
dividend
\u00a0
of NOK 9.40
\u00a0
per share
\u00a0
to be resolved
\u00a0
by the Annual
General Meeting in May 2023 and paid out in
\u00a0
two tranches of NOK 5.00 and NOK 4.40
\u00a0
per share in May 2023
\u00a0
and October 2023, respectively. The
total ordinary dividend amount proposed for the
\u00a0
financial year 2022 is NOK 13.2 billion.
\u00a0
Following the successful transaction of divesting 30%
\u00a0
of Telenor Fiber AS, Telenor Group has decided to
\u00a0
initiate a 2023-2024 share buyback
programme. The Board of Directors of Telenor
\u00a0
ASA held an extraordinary general meeting on
\u00a0
26 January 2023 asking the General Meeting
\u00a0
for a
share buyback
\u00a0
authorisation.
\u00a0
The programme
\u00a0
size will
\u00a0
be limited
\u00a0
to NOK 3.7
\u00a0
billion and
\u00a0
up to 47
\u00a0
million shares.
\u00a0
Telenor\u2019s shareholder remuneration policy
\u00a0
is to aim for a year-on-year growth in
\u00a0
dividend per share, where the annual dividends
\u00a0
are paid in two
instalments. Buyback of own shares or extraordinary
\u00a0
dividend pay-outs might also be used as a
\u00a0
measure to reach a targeted leverage.
Telenor Group Treasury is responsible for funding
\u00a0
and financial risk management for the parent company
\u00a0
and subsidiaries owned, directly or
indirectly, more than 90% by Telenor ASA.
\u00a0
Subsidiaries owned less than 90% normally have stand-alone
\u00a0
financing and management of financial
risks. Beyond hedging activities, the Group has
\u00a0
limited trading activities.
\u00a0
Liquidity
\u00a0
risk is the
\u00a0
ability
\u00a0
to ensure
\u00a0
appropriate
\u00a0
funding.
\u00a0
The Group
\u00a0
emphasises
\u00a0
financial
\u00a0
flexibility,
\u00a0
and an important
\u00a0
part of this
\u00a0
is to minimise
liquidity risk through ensuring access to a
\u00a0
diversified set of funding sources. Debt issued in
\u00a0
the international capital market is predominately issued
under the existing EMTN programme (Euro Medium
\u00a0
Term Note) to secure longer dated funding
\u00a0
and under existing ECP programme (Euro
Commercial Paper) to secure shorter dated funding
\u00a0
up to 12 months. In addition to
\u00a0
these uncommitted loan programmes, the Norwegian domestic
capital market
\u00a0
is used from
\u00a0
time to time.
\u00a0
Telenor ASA also has a sustainability-linked
\u00a0
committed syndicated revolving credit facility (RCF) of EUR
\u00a0
1.8 billion with maturity in 2025.
\u00a0
The RCF
was undrawn as of 31 December 2022.
\u00a0
When permissible by local rules and regulations,
\u00a0
subsidiaries owned 90% or more are part
\u00a0
of Telenor ASA\u2019s cash management framework
agreements and participate in Telenor ASA\u2019s cash pool
\u00a0
setup. Subsidiaries owned less than 90% have established
\u00a0
separate framework
agreements for banking services.
\u00a0
Telenor
\u00a0
ASA shall
\u00a0
have sufficient
\u00a0
sources of
\u00a0
liquidity
\u00a0
to cover expected
\u00a0
operational
\u00a0
liquidity
\u00a0
needs for
\u00a0
the next
\u00a0
12 months.
\u00a0
Liquidity
\u00a0
requirements
\u00a0
to
fund acquisitions is considered separately.
Maturity profile of the Group\u2019s liabilities (in nominal values)
\u00a0
NOK in millions
31.12.22
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
Not
specified
Interest-bearing
\u00a0
liabilities
Financial Debt
91 267
8 907
14 579
12 498
11 608
7 997
6 701
11 524
717
6 310
-
10 425
-
Other interest-bearing
\u00a0
liabilities
252
252
-
-
-
-
-
-
-
-
-
-
-
Sum of interest-bearing
\u00a0
liabilities
1)
91 518
9 159
14 579
12 498
11 608
7 997
6 701
11 524
717
6 310
-
10 425
-
Non-interest-bearing
\u00a0
liabilities
Trade and other
\u00a0
payables
28 227
28 227
-
-
-
-
-
-
-
-
-
-
-
Other current
\u00a0
non-interest-bearing
liabilities
1 308
1 308
-
-
-
-
-
-
-
-
-
-
-
Derivative
\u00a0
financial instruments
1 841
386
923
224
125
183
-
-
-
-
-
-
-
Other non-current
\u00a0
non-interest-
bearing liabilities
317
-
-
-
-
-
-
-
-
-
-
-
317
Sum of non-interest-bearing
liabilities
31 692
29 920
923
224
125
183
-
-
-
-
-
-
317
Total
123 211
39 080
15 502
12 721
11 733
8 181
6 701
11 524
717
6 310
-
10 425
317
Future interest
\u00a0
payments
9 491
2 030
2 022
1 566
1 043
769
651
445
245
219
155
346
-
Total including
\u00a0
future interest
payments
132 701
41 109
17 524
14 288
12 776
8 950
7 352
11 969
962
6 529
154
10 771
317
NOK in millions
Total as of
31.12.21
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
Not
specified
Interest-bearing
\u00a0
liabilities
Financial Debt
96 008
9 143
8 694
13 236
11 157
11 823
7 840
6 331
11 611
665
5 655
9 854
-
Other interest-bearing
\u00a0
liabilities
134
134
-
-
-
-
-
-
-
-
-
-
-
Sum of interest-bearing
\u00a0
liabilities
96 142
9 276
8 694
13 236
11 157
11 823
7 840
6 331
11 611
665
5 655
9 854
-
Non-interest-bearing
\u00a0
liabilities
Trade and other
\u00a0
payables
32 320
32 320
-
-
-
-
-
-
-
-
-
-
-
Other current
\u00a0
non-interest-bearing
liabilities
1 294
1 294
-
-
-
-
-
-
-
-
-
-
-
Derivative
\u00a0
financial instruments
1 782
675
44
284
216
387
59
54
-
-
63
-
-
Other non-current
\u00a0
non-interest-
bearing liabilities
282
-
-
-
-
-
-
-
-
-
-
-
282
Sum of non-interest-bearing
liabilities
35 677
34 288
44
284
216
387
59
54
-
-
63
-
282
Total
131 818
43 565
8 738
13 520
11 374
12 210
7 898
6 384
11 611
665
5 718
9 854
282
Future interest
\u00a0
payments
8 260
1 322
1 425
1 415
1 056
781
584
462
365
224
196
430
-
Total including
\u00a0
future interest
payments
140 079
44 887
10 163
14 935
12 430
12 991
8 482
6 846
11 976
889
5 913
10 284
282
5)
The maturity tables do not include lease liabilities
\u00a0
related to licences or other lease liabilities. See note
\u00a0
29 for more information on licence commitments
\u00a0
and
lease liabilities.
The Group
\u00a0
is exposed
\u00a0
to interest
\u00a0
rate risk
\u00a0
through funding
\u00a0
and cash
\u00a0
management
\u00a0
activities.
\u00a0
Changes in
\u00a0
interest rates
\u00a0
affect the
\u00a0
fair value
\u00a0
of assets
and liabilities. Interest income and interest expense
\u00a0
in the income statement are influenced by
\u00a0
changes in interest rates in the market. In
\u00a0
2022,
average interest rate for the Group was
\u00a0
1.8%
\u00a0
on interest-bearing liabilities,
\u00a0
excluding lease and licence liabilities (1.6%
\u00a0
in 2021).
The majority of debt issued by the
\u00a0
Group is fixed rate debt. The Group uses interest
\u00a0
rate derivatives to manage interest rate risk
\u00a0
of the debt
portfolio. This typically involves interest rate swaps,
\u00a0
swapping floating interest rates to fixed interest
\u00a0
rates and vice versa.
\u00a0
According to Group Policy, Telenor subsidiaries with
\u00a0
external debt instruments shall maintain a balanced profile
\u00a0
between fixed and floating rate
debt. The portion of the fixed rate shall be between
\u00a0
30% to 70% of external debt. As
\u00a0
of 31 December 2022, the portion of
\u00a0
fixed rate of Group\u2019s debt
was 58% (50%
\u00a0
as of 31. December 2021). For Telenor ASA the
\u00a0
portion
\u00a0
of fixed rate debt as of 31 December
\u00a0
2022 was 58% (55% as of
\u00a0
31. December
2021).
Effect from the interest rate benchmark reform
\u00a0
The Group is exposed to the interest
\u00a0
rate benchmark reform (IBOR reform) through financial
\u00a0
instruments with exposures from EURIBOR, THBFIX
(Thai Baht)
\u00a0
and USD
\u00a0
Libor interest
\u00a0
rate fixings.
\u00a0
In 2022,
\u00a0
dtac has
\u00a0
converted
\u00a0
part of the
\u00a0
exposure
\u00a0
from THBFIX
\u00a0
to THOR (Thai
\u00a0
Overnight
\u00a0
Repurchase
Rate) trough
\u00a0
issuance
\u00a0
of new bonds
\u00a0
or conversion
\u00a0
of legacy
\u00a0
derivatives.
\u00a0
Outside of
\u00a0
these agreements
\u00a0
in Thailand,
\u00a0
there are
\u00a0
no other effects
\u00a0
on the
Group\u2019s consolidated financial statements as a result
\u00a0
of the IBOR reform. The Group has
\u00a0
signed ISDA Fallback Protocol and supplement as part
\u00a0
of
the transition
\u00a0
plan to the
\u00a0
alternative
\u00a0
rates, further
\u00a0
Group is
\u00a0
in dialogue
\u00a0
with counterparties
\u00a0
about the
\u00a0
IBOR reform,
\u00a0
and this has
\u00a0
not resulted
\u00a0
in
changes to
\u00a0
the Group\u2019s
\u00a0
risk management
\u00a0
strategy.
The table
\u00a0
below shows
\u00a0
the financial
\u00a0
instruments
\u00a0
impacted
\u00a0
by interest
\u00a0
rate benchmark
\u00a0
reform as
\u00a0
of 31 December
\u00a0
2022:
Nominal amount
NOK in millions
Bonds
EURIBOR 12 months
72 217
THBFIX 6 months
14 325
86 542
EURIBOR 6 months
21 578
EURIBOR 3 months
12 631
THBFIX 6 months
2 418
USD LIBOR 6 months
-
USD LIBOR 3 months
4 607
41 235
Cross Currency
\u00a0
Swaps
EURIBOR 6 months
11 052
EURIBOR 3 months
14 089
USD LIBOR 3 months
16 004
41 146
Derivative instruments designated as fair value hedging instruments
The majority of debt is issued using fixed
\u00a0
rate bonds. In order to manage interest rate
\u00a0
risk, a portion of the debt may be
\u00a0
swapped to floating interest
rate by using interest rate swaps. Fair value
\u00a0
hedge accounting is applied when hedge accounting
\u00a0
criteria are met. There is an economic relationship
between the hedged items and the hedging instruments,
\u00a0
as the terms of the interest rate
\u00a0
swaps match the terms of the fixed
\u00a0
rate bonds (i.e.,
notional amount, maturity, payment and rate set
\u00a0
dates).
\u00a0
Effectiveness
\u00a0
testing is
\u00a0
performed
\u00a0
using the
\u00a0
hypothetical
\u00a0
derivative
\u00a0
method and
\u00a0
compares
\u00a0
changes in
\u00a0
fair value
\u00a0
of the hedging
\u00a0
instrument
\u00a0
against
the changes in fair value of the
\u00a0
hedged item attributable to the hedged risk. Hedge
\u00a0
ineffectiveness in fair value hedges can arise
\u00a0
from:
\u00a0
\u25cf
Different interest rate curve applied to discount
\u00a0
the hedged items and hedging instruments.
\u00a0
\u25cf
Differences
\u00a0
in timing
\u00a0
of cash flows
\u00a0
of the hedged
\u00a0
items and
\u00a0
hedging instruments.
\u00a0
The table
\u00a0
below shows
\u00a0
the effects
\u00a0
of the Group\u2019s
\u00a0
fair value
hedges.
\u25cf
The effects of the forthcoming IBOR reforms
\u00a0
because these might take effect at a
\u00a0
different time and have a different impact on the
\u00a0
hedged
item (the fixed rate debt) and the hedging instruments (the interest
\u00a0
rate swaps used to hedge the debt).
The change in fair value of the
\u00a0
hedging instrument and the hedged item is recognised
\u00a0
on the line item Net change in fair value
\u00a0
of hedging
instruments and hedged items under net financial
\u00a0
income (expenses) in the income statement, see
\u00a0
also note 9.
\u00a0
Fair value hedging relationships
\u00a0
NOK in millions
2022
2021
Net gain /
\u00a0
(loss) recognised
\u00a0
in the income
\u00a0
statement on
\u00a0
hedged items
4 118
1 280
Net gain /
\u00a0
(loss) recognised
\u00a0
in the income
\u00a0
statement on
\u00a0
hedging instruments
(4 317)
(1 323)
Amount of hedge
\u00a0
ineffectiveness
(200)
(44)
Financial instruments designated as hedging instruments in fair value hedges
\u00a0
are classified on the line items Other non-current
\u00a0
assets and Other
current financial assets in the statement of
\u00a0
financial position, see note 27,
\u00a0
and current and non-current interest-bearing
\u00a0
liabilities, see note 30:
2022
2021
NOK in millions
Assets
Liabilities
Assets
Liabilities
As of 31 December
Nominal amounts
\u00a0
fair value hedge
\u00a0
instruments
37 424
-
42 278
-
Fair values
\u00a0
of fair value
\u00a0
hedge instruments
27
(3 663)
1 071
(120)
The following
\u00a0
table shows
\u00a0
the maturity
\u00a0
profile
\u00a0
of the Group\u2019s
\u00a0
fair value
\u00a0
hedge instruments
\u00a0
(in nominal
\u00a0
values):
NOK in millions
Total
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
As of 31 December
\u00a0
2022
(2 416)
(524)
(528)
(468)
(375)
(256)
(144)
(46)
(19)
(19)
(19)
(19)
As of 31 December
\u00a0
2021
2 148
524
378
369
321
203
119
91
79
13
13
40
The terms
\u00a0
of the fixed
\u00a0
rate receive
\u00a0
leg of the
\u00a0
interest rate
\u00a0
swaps designated
\u00a0
as fair
\u00a0
value hedge
\u00a0
instruments
\u00a0
match the
\u00a0
terms of the
\u00a0
fixed rate
\u00a0
pay
leg of the hedged items. The average interest
\u00a0
rate terms of the floating pay legs of
\u00a0
the interest rate swaps are EURIBOR 3/6 months +
\u00a0
72 basis
points (+
\u00a0
71 basis
\u00a0
points in
\u00a0
2021) for
\u00a0
EUR denominated
\u00a0
swaps,
\u00a0
and THBFIX
\u00a0
+ 146 basis
\u00a0
points (+
\u00a0
140 basis
\u00a0
points in
\u00a0
2021) and
\u00a0
THOR + 143
\u00a0
basis points
(n.a. in 2021) for THB denominated swaps.
The table
\u00a0
below shows
\u00a0
the carrying
\u00a0
amounts of
\u00a0
the Group\u2019s
\u00a0
fair value
\u00a0
hedge items,
\u00a0
which are
\u00a0
recognised
\u00a0
on the line
\u00a0
items Non-current
\u00a0
interest-
bearing liabilities and Current interest-bearing liabilities in the statement
\u00a0
of financial position:
NOK in millions
2022
2021
As of 31 December
Carrying amount
\u00a0
of hedged items
\u00a0
recognised in
\u00a0
the statement
\u00a0
of financial
\u00a0
position
33 004
43 003
Fair value
\u00a0
hedge adjustments
\u00a0
included in the
\u00a0
carrying amount
\u00a0
of the hedged
\u00a0
items
(3 288)
825
Interest rate risk sensitivity analysis
\u00a0
The Group
\u00a0
calculates
\u00a0
the sensitivity
\u00a0
on the change
\u00a0
in fair
\u00a0
value of
\u00a0
assets and
\u00a0
liabilities
\u00a0
of a defined
\u00a0
parallel
\u00a0
shift in
\u00a0
the yield
\u00a0
curve of
\u00a0
the relevant
currencies.
\u00a0
For each
\u00a0
simulation,
\u00a0
the same
\u00a0
shifts in
\u00a0
interest rates
\u00a0
are used
\u00a0
for all currencies.
\u00a0
The sensitivity
\u00a0
analysis
\u00a0
is run only
\u00a0
for assets
\u00a0
and
liabilities
\u00a0
that represent
\u00a0
significant
\u00a0
interest-bearing
\u00a0
positions.
\u00a0
Due to debt
\u00a0
instruments
\u00a0
the net position
\u00a0
is a liability.
\u00a0
Since hedge
\u00a0
accounting
\u00a0
is
applied and interest-bearing debt is measured at amortised cost,
\u00a0
the full effect of change in fair
\u00a0
value is not recognised in the income statement.
This is
\u00a0
shown in
\u00a0
the table
\u00a0
below:
2022
2021
NOK in millions
Yield curve
\u00a0
increase
50 Basis points
Yield curve
\u00a0
decrease
50 Basis points
Yield curve
\u00a0
increase
50 Basis points
Yield curve
\u00a0
decrease
50 Basis points
Reduction (increase)
\u00a0
in fair value
\u00a0
of net liabilities
1 225
(1 278)
1 629
(1 709)
Gain (loss)
\u00a0
in the income
\u00a0
statement
66
(69)
41
(44)
Sensitivity analysis of change in floating interest rates
\u00a0
on net financial items in the income statement:
2022
2021
NOK in millions
Yield curve
\u00a0
increase
50 Basis points
Yield curve
\u00a0
decrease
50 Basis points
Yield curve
\u00a0
increase
50 Basis points
Yield curve
\u00a0
decrease
50 Basis points
Gain (loss)
\u00a0
in the income
\u00a0
statement
(399)
399
(491)
491
The Group is exposed to changes in
\u00a0
the value of NOK relative to other currencies.
\u00a0
The carrying amount of the Group\u2019s net investments
\u00a0
in foreign
entities
\u00a0
and proceeds
\u00a0
from these
\u00a0
investments
\u00a0
varies with
\u00a0
changes in
\u00a0
the foreign
\u00a0
exchange
\u00a0
rate. The
\u00a0
net income
\u00a0
of the Group
\u00a0
is also affected
\u00a0
by
currency fluctuations, as the profit and losses
\u00a0
from foreign operations are translated into NOK
\u00a0
using average exchange rates for the period.
Exchange rate risk related to some net
\u00a0
investments in foreign operations is partly hedged
\u00a0
by issuing debt instruments in the currencies involved or
correlated currencies when this
\u00a0
is considered appropriate. Combinations of money market
\u00a0
instruments (Commercial Paper and bonds) and
derivatives
\u00a0
(foreign
\u00a0
exchange
\u00a0
forward contracts
\u00a0
and cross
\u00a0
currency
\u00a0
swaps) are
\u00a0
used for
\u00a0
this purpose.
\u00a0
Short-term
\u00a0
currency
\u00a0
swaps are
\u00a0
used for
liquidity management purposes. Net investment hedge accounting
\u00a0
is applied when possible.
Exchange
\u00a0
rate risk
\u00a0
also arises
\u00a0
when Telenor
\u00a0
ASA or any
\u00a0
of its subsidiaries
\u00a0
enter into
\u00a0
transactions
\u00a0
or holds
\u00a0
monetary
\u00a0
items denominated
\u00a0
in other
currencies than their own functional currency. In
\u00a0
accordance with Group Policy, committed cash flows in
\u00a0
foreign currency equivalent to NOK 300
million or above are evaluated for hedging.
Financial instruments designated as hedging instruments of net investment in
\u00a0
foreign operations
As of 31 December 2022 and 2021,
\u00a0
material hedging positions are designated as net
\u00a0
investment hedges.
There is an economic relationship between the hedged items
\u00a0
and the hedging instruments as the net
\u00a0
investment creates a translation risk that will
match the
\u00a0
foreign
\u00a0
exchange
\u00a0
risk on the
\u00a0
debt and
\u00a0
derivatives
\u00a0
designated
\u00a0
as hedging
\u00a0
instruments.
Net investment hedging is mainly applied in currencies that
\u00a0
have well-functioning financial markets, but the Group
\u00a0
may also designate debt in
correlated currencies as hedging instruments to hedge foreign
\u00a0
exchange risk.
The Group has established hedge ratios to match
\u00a0
the underlying risk of the hedging instruments
\u00a0
with the hedged risk component. Hedge
ineffectiveness may arise when the amount of
\u00a0
the investment in the foreign subsidiary becomes
\u00a0
lower than the amount of the debt
\u00a0
and derivatives
designated as hedging instruments. There was no
\u00a0
ineffectiveness in the years ending 31 December 2022 and 2021.
For additional information and a reconciliation of the
\u00a0
net investment hedge balance in equity, see
\u00a0
note 28.
\u00a0
Net investment hedging relationships
NOK in millions
2022
2021
Amount recognised
\u00a0
directly to other
\u00a0
comprehensive
\u00a0
income (OCI)
(1 402)
2 447
Amount reclassified
\u00a0
from OCI to the
\u00a0
income statement
\u00a0
on disposal
233
-
Net investment hedging was performed for the
\u00a0
investment in Bangladesh using USD denominated instruments,
\u00a0
but hedging was discontinued due
to loss of economic relationship during 2022.
\u00a0
As of 31 December 2022, the remaining balance included in
\u00a0
the net investment hedge reserve was
Interest-bearing debt and
\u00a0
derivatives designated as hedging instruments in net
\u00a0
investment hedges (only effective part of instruments is
\u00a0
included):
2022
2021
NOK in millions
Debt
Derivatives
Debt
Derivatives
As of 31 December
Nominal amounts
\u00a0
net investment
\u00a0
hedge instruments
(50 533)
8 372
(54 232)
9 184
Fair value
\u00a0
net investment
\u00a0
hedge instruments
(44 000)
(974)
(55 997)
(1 273)
Debt designated as hedging instruments in net
\u00a0
investment hedges are recognised on the line
\u00a0
items Non-current interest-bearing
\u00a0
liabilities and
Current interest-bearing
\u00a0
liabilities in the statement of financial position.
\u00a0
Classification
\u00a0
of derivatives
\u00a0
designated
\u00a0
for net investment
\u00a0
hedge in
\u00a0
the consolidated
\u00a0
statement
\u00a0
of financial
\u00a0
position:
NOK in millions
2022
2021
As of 31 December
Other non-current
\u00a0
assets
713
27
Other financial
\u00a0
current assets
2
320
Non-current non-interest-bearing
\u00a0
financial liabilities
(1 306)
(950)
Current non-interest-bearing
\u00a0
liabilities
(382)
(669)
Fair value net
\u00a0
investment hedge
\u00a0
instruments
(974)
(1 273)
The following
\u00a0
table shows
\u00a0
the maturity
\u00a0
profile (in
\u00a0
nominal values)
\u00a0
of the Group\u2019s
\u00a0
net investment
\u00a0
hedge instruments
\u00a0
(only effective
\u00a0
part of
instruments is included):
NOK in millions
Total
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
As of 31 December
\u00a0
2022
(44 646)
(6 084)
(2 766)
(1 284)
(6 800)
(2 653)
(4 194)
(8 233)
(130)
(4 137)
(105)
(8 259)
As of 31 December
\u00a0
2021
(49 304)
(5 688)
(1 903)
(3 707)
(2 449)
(7 126)
(3 057)
(4 223)
(8 259)
(134)
(4 372)
(8 386)
Average currency rates in cross currency swaps
\u00a0
designated as net investment hedge instruments were
\u00a0
NOK/USD n.a. (8.57
\u00a0
in 2021), USD/EUR 1.15
(1.16 in 2021), SEK/EUR 10.47
\u00a0
(10.47 in 2021) and NOK/EUR 10.83
\u00a0
(10.83 in 2021) in 2022. In 2022, average currency
\u00a0
rates in foreign exchange contracts
designated as net investment hedge instruments were
\u00a0
NOK/SEK 0.95 (1.00 in 2021), NOK/EUR 10.57 (9.98
\u00a0
in 2021), USD/EUR n.a. (1.16
\u00a0
in 2021),
USD/MYR 0.22
\u00a0
(0.24 in
\u00a0
2021) and
\u00a0
USD/THB 0.03
\u00a0
(0.03 in 2021).
Exchange
\u00a0
rate risk
\u00a0
sensitivity
\u00a0
analysis
\u00a0
This analysis does not consider correlation between
\u00a0
currencies. Empirical studies confirm substantial diversification effect across
\u00a0
the currencies
that the Group
\u00a0
is exposed
\u00a0
to.
Effects on net currency gains (losses)
Currency gains and losses on monetary items
\u00a0
in foreign currency are recognised in the
\u00a0
income statements of Telenor ASA and its
\u00a0
subsidiaries. Net
currency
\u00a0
gains (losses)
\u00a0
in foreign
\u00a0
subsidiaries
\u00a0
are translated
\u00a0
to NOK in
\u00a0
the consolidated
\u00a0
income statement.
\u00a0
The table
\u00a0
below shows
\u00a0
the effect
\u00a0
on
consolidated net currency losses of 10% depreciation
\u00a0
in functional currencies in the Group, keeping other currencies
\u00a0
constant (only significant
exposures
\u00a0
are included
\u00a0
in the table):
Monetary Item
\u00a0
Currency
2022
2021
NOK in millions
EUR
SEK
USD
Other
EUR
SEK
USD
Other
Depreciating
\u00a0
Functional Currency
NOK
-
(510)
(677)
(104)
(146)
(443)
(1 212)
(116)
Effects due to foreign exchange translations on other comprehensive income
Translation
\u00a0
of subsidiaries
\u00a0
from their
\u00a0
functional
\u00a0
currencies
\u00a0
into the presentation
\u00a0
currency
\u00a0
of the Group
\u00a0
(NOK) will
\u00a0
impact the
\u00a0
Group\u2019s other
comprehensive income (OCI) and equity. If NOK
\u00a0
had weakened by 10% against all other
\u00a0
functional currencies of the Group, the change
\u00a0
in the
carrying amount of consolidated equity as of 31
\u00a0
December 2022, including effects of net investment
\u00a0
hedge, would have been an increase of
approximately
\u00a0
NOK 2.1
\u00a0
billion (increase
\u00a0
of NOK 2.2
\u00a0
billion as
\u00a0
of 31 December
\u00a0
2021).
The table
\u00a0
below shows
\u00a0
the impact
\u00a0
on OCI of
\u00a0
net investment
\u00a0
hedge (NIH)
\u00a0
instruments
\u00a0
if the functional
\u00a0
currency
\u00a0
weakened
\u00a0
by 10%.
2022
2021
NOK in millions
EUR
SEK
USD
Other
EUR
SEK
USD
Other
Currency effect
\u00a0
on OCI (before
\u00a0
tax) of NIH instruments
NOK
(2 420)
(1 211)
-
(585)
(2 474)
(1 128)
(267)
(636)
Effect on other
\u00a0
comprehensive
\u00a0
income (OCI)
-
-
-
(4 216)
-
-
-
(4 505)
Effects due to foreign exchange translations on net income
\u00a0
Translation
\u00a0
of net income
\u00a0
from subsidiaries
\u00a0
with functional
\u00a0
currency
\u00a0
other than
\u00a0
NOK, also
\u00a0
represents
\u00a0
a currency
\u00a0
exposure
\u00a0
for the Group\u2019s
\u00a0
reported
figures.
\u00a0
If the presentation
\u00a0
currency
\u00a0
(NOK) had
\u00a0
weakened
\u00a0
/ strengthened
\u00a0
by 10% against
\u00a0
all other
\u00a0
currencies
\u00a0
included
\u00a0
in the analysis,
\u00a0
net income
\u00a0
for
the Group would have been NOK 0.6
\u00a0
billion higher / lower in 2022 (NOK 0.3
\u00a0
billion in 2021).
\u00a0
Credit risk is the loss that the Group
\u00a0
would suffer if a counterparty fails to
\u00a0
perform its financial obligations. The Group considers its
\u00a0
maximum
exposure
\u00a0
to credit
\u00a0
risk to be
\u00a0
as follows:
Maximum credit exposure
NOK in millions
2022
2021
Cash and cash
\u00a0
equivalents
9 929
15 223
Bonds and commercial
\u00a0
papers > 3 months
\u00a0
(note 27)
277
327
Financial derivatives
\u00a0
(note 27)
1 017
1 333
Current interest-bearing
\u00a0
receivables
\u00a0
\u2013 deferred payment
\u00a0
from disposal
\u00a0
(note 19)
-
998
Trade and other
\u00a0
current financial
\u00a0
receivables
\u00a0
(note 19)
16 480
17 286
The Group\u2019s credit risks largely arise from
\u00a0
trade receivables, financial derivatives and cash and
\u00a0
cash equivalents.
\u00a0
Credit risk
\u00a0
from cash
\u00a0
and cash
\u00a0
equivalents
\u00a0
is managed
\u00a0
by the Group\u2019s
\u00a0
Treasury
\u00a0
department
\u00a0
in accordance
\u00a0
with the
\u00a0
principles
\u00a0
defined in
\u00a0
the Group
Policy Treasury. Cash deposits are only made with approved
\u00a0
counterparties and in accordance with approved credit limits per
\u00a0
counterparty.
Counterparty
\u00a0
credit limits
\u00a0
for core
\u00a0
banks are
\u00a0
reviewed
\u00a0
by the Group\u2019s
\u00a0
Board of
\u00a0
Directors
\u00a0
on a regular
\u00a0
basis. The
\u00a0
limits are
\u00a0
set to minimise
\u00a0
the
concentration of risks and therefore mitigate financial loss
\u00a0
through a counterparty\u2019s potential payment default.
\u00a0
Credit risk arising from financial derivatives and
\u00a0
cash deposits is managed through diversification, internal
\u00a0
risk assessment and credit scoring, as
well as credit risk mitigation tools. The
\u00a0
main risk mitigation tools include legal netting and
\u00a0
collateral agreements.
\u00a0
Credit risk
\u00a0
related to
\u00a0
trade receivables
\u00a0
is assessed
\u00a0
to be limited
\u00a0
due to the
\u00a0
high number
\u00a0
of customers
\u00a0
in the Group\u2019s
\u00a0
customer
\u00a0
base. As
\u00a0
such, no
further credit
\u00a0
risk provision
\u00a0
is required
\u00a0
in excess
\u00a0
of the normal
\u00a0
provision
\u00a0
for bad
\u00a0
and doubtful
\u00a0
receivables.
\u00a0
See note
\u00a0
19 for information
\u00a0
on
receivables in terms of age distribution and
\u00a0
provision for bad debt. Credit risk related to
\u00a0
sale of handsets on instalment plans, where
\u00a0
the effect of
discounting is considered material, is also assessed
\u00a0
to be limited. Credit risk related to
\u00a0
such arrangements are embedded in the discount rate and
reflected
\u00a0
as reduced
\u00a0
revenue.
As of 31
\u00a0
December
\u00a0
2022, NOK
\u00a0
264 million
\u00a0
was posted
\u00a0
as cash collateral
\u00a0
(receivable).
\u00a0
As of 31 December
\u00a0
2021, NOK
\u00a0
658 million
\u00a0
was posted
\u00a0
as cash
collateral (receivable).
NOTE 31
Capital and financial risk management
The objectives and policies for capital and risk management
\u00a0
are described in this note, in addition to exposure and
sensitivity for financial risks such as liquidity risk, interest
\u00a0
rate risk, foreign exchange risk and credit risk. Telenor
uses various types of derivatives to hedge such exposure.
\u00a0
Accounting policies
Hedge accounting is applied for fair value
\u00a0
hedges and hedges of net investments in foreign
\u00a0
operations when the hedging criteria are met.
\u00a0
For fair
value
\u00a0
hedges, the carrying amount of the hedged
\u00a0
item is adjusted for gains and losses attributable
\u00a0
to the risk being hedged. The derivative is also
measured at fair value, and gains and losses
\u00a0
from both the hedging instrument and the hedged
\u00a0
item are recognised in the income statement.
Hedge effectiveness
\u00a0
is assessed
\u00a0
on an ongoing
\u00a0
basis, and
\u00a0
hedge accounting
\u00a0
is discontinued
\u00a0
if the hedge
\u00a0
no longer
\u00a0
meets the
\u00a0
hedge accounting
criteria.
\u00a0
If the hedged
\u00a0
item still
\u00a0
exists and
\u00a0
is not sold,
\u00a0
the fair
\u00a0
value adjustment
\u00a0
to the hedged
\u00a0
item attributable
\u00a0
to the risk
\u00a0
being hedged
\u00a0
at de-
designation
\u00a0
will be
\u00a0
amortised
\u00a0
in the income
\u00a0
statement
\u00a0
over the
\u00a0
remaining
\u00a0
time to maturity.
\u00a0
A hedge
\u00a0
of a net investment
\u00a0
in a foreign
\u00a0
operation
\u00a0
is accounted
\u00a0
for in a
\u00a0
similar way
\u00a0
as a cash
\u00a0
flow hedge.
\u00a0
Foreign exchange
\u00a0
gains or
\u00a0
losses on
\u00a0
the
hedging instrument relating to the effective portion of
\u00a0
the hedge are recognised directly in other
\u00a0
comprehensive income while any foreign
exchange gains or losses relating to the
\u00a0
ineffective portion are recognised in the income statement.
\u00a0
On disposal of the foreign entity, the
cumulative foreign exchange gains or losses recognised in
\u00a0
other comprehensive income is reclassified to the
\u00a0
income statement.
Refer to
\u00a0
note 27 Financial
\u00a0
assets and
\u00a0
liabilities
\u00a0
for further
\u00a0
information
\u00a0
on accounting
\u00a0
policies
\u00a0
for derivatives.
.
In recent
\u00a0
years, Telenor
\u00a0
has measured
\u00a0
leverage
\u00a0
as the ratio
\u00a0
of Net debt
\u00a0
to EBITDA
\u00a0
before other
\u00a0
items. Following
\u00a0
the structural
\u00a0
changes in
\u00a0
the
portfolio,
\u00a0
and triggered
\u00a0
by closing
\u00a0
of the merger
\u00a0
in Malaysia,
\u00a0
Telenor measures
\u00a0
the leverage
\u00a0
from 2022
\u00a0
as the ratio
\u00a0
of Net debt
\u00a0
to EBITDA
\u00a0
before
other items and dividends from associated companies
\u00a0
and joint ventures. Telenor aims to maintain
\u00a0
a solid balance sheet through
\u00a0
keeping leverage
ratio in the range of 1.8x to
\u00a0
2.3x maintain financial flexibility and ensure cost efficient
\u00a0
funding (see page 180 for alternative performance measures).
As of 31 December 2022,
\u00a0
the reported leverage ratio was 2.2x
\u00a0
(2.1x
\u00a0
as of 31 December 2021).
\u00a0
The targeted capital structure provides a good
\u00a0
balance
between shareholder return and a solid balance
\u00a0
sheet with stable access to global debt markets,
\u00a0
while also supporting Telenor\u2019s strategic priorities.
As of 31 December 2022, Telenor ASA\u2019s long-term credit
\u00a0
rating was \u201cBaa1/stable outlook\u201d
\u00a0
by Moody\u2019s Investors Service and \u201cA-/stable outlook\u201d
\u00a0
by
Standard & Poor\u2019s (S&P). During 2022, Moody\u2019s changed
\u00a0
their rating and outlook from \u201cA3/negative watch\u201d
\u00a0
to \u201cBaa1/stable outlook\u201d, while S&P\u2019s
rating and outlook were unchanged throughout
\u00a0
the year.
\u00a0
Key elements
\u00a0
of the Group\u2019s
\u00a0
capital
\u00a0
structure
\u00a0
include
\u00a0
interest-bearing
\u00a0
debt as
\u00a0
disclosed
\u00a0
in note 30,
\u00a0
cash and cash
\u00a0
equivalents
\u00a0
as disclosed
\u00a0
in note
20 and equity
\u00a0
attributable
\u00a0
to the shareholders
\u00a0
of Telenor
\u00a0
ASA as presented
\u00a0
in the consolidated
\u00a0
statement
\u00a0
of changes
\u00a0
in equity
\u00a0
and in note
\u00a0
28.
\u00a0
In order
\u00a0
to adjust
\u00a0
the capital
\u00a0
structure,
\u00a0
the Group
\u00a0
may acquire
\u00a0
or sell own
\u00a0
shares, distribute
\u00a0
dividends
\u00a0
to shareholders,
\u00a0
return capital
\u00a0
to
shareholders or issue new shares. In 2022, Telenor\u2019s
\u00a0
shareholder remuneration via dividend was NOK 13.0 billion
\u00a0
comprised of ordinary dividends
paid out in June 2022 (NOK 5.00 per
\u00a0
share) and October 2022 (NOK 4.30 per share).
\u00a0
For the financial
\u00a0
year 2022,
\u00a0
the Telenor
\u00a0
Board of
\u00a0
Directors
\u00a0
will propose
\u00a0
an ordinary
\u00a0
dividend
\u00a0
of NOK 9.40
\u00a0
per share
\u00a0
to be resolved
\u00a0
by the Annual
General Meeting in May 2023 and paid out in
\u00a0
two tranches of NOK 5.00 and NOK 4.40
\u00a0
per share in May 2023
\u00a0
and October 2023, respectively. The
total ordinary dividend amount proposed for the
\u00a0
financial year 2022 is NOK 13.2 billion.
\u00a0
Following the successful transaction of divesting 30%
\u00a0
of Telenor Fiber AS, Telenor Group has decided to
\u00a0
initiate a 2023-2024 share buyback
programme. The Board of Directors of Telenor
\u00a0
ASA held an extraordinary general meeting on
\u00a0
26 January 2023 asking the General Meeting
\u00a0
for a
share buyback
\u00a0
authorisation.
\u00a0
The programme
\u00a0
size will
\u00a0
be limited
\u00a0
to NOK 3.7
\u00a0
billion and
\u00a0
up to 47
\u00a0
million shares.
\u00a0
Telenor\u2019s shareholder remuneration policy
\u00a0
is to aim for a year-on-year growth in
\u00a0
dividend per share, where the annual dividends
\u00a0
are paid in two
instalments. Buyback of own shares or extraordinary
\u00a0
dividend pay-outs might also be used as a
\u00a0
measure to reach a targeted leverage.
Telenor Group Treasury is responsible for funding
\u00a0
and financial risk management for the parent company
\u00a0
and subsidiaries owned, directly or
indirectly, more than 90% by Telenor ASA.
\u00a0
Subsidiaries owned less than 90% normally have stand-alone
\u00a0
financing and management of financial
risks. Beyond hedging activities, the Group has
\u00a0
limited trading activities.
\u00a0
Liquidity
\u00a0
risk is the
\u00a0
ability
\u00a0
to ensure
\u00a0
appropriate
\u00a0
funding.
\u00a0
The Group
\u00a0
emphasises
\u00a0
financial
\u00a0
flexibility,
\u00a0
and an important
\u00a0
part of this
\u00a0
is to minimise
liquidity risk through ensuring access to a
\u00a0
diversified set of funding sources. Debt issued in
\u00a0
the international capital market is predominately issued
under the existing EMTN programme (Euro Medium
\u00a0
Term Note) to secure longer dated funding
\u00a0
and under existing ECP programme (Euro
Commercial Paper) to secure shorter dated funding
\u00a0
up to 12 months. In addition to
\u00a0
these uncommitted loan programmes, the Norwegian domestic
capital market
\u00a0
is used from
\u00a0
time to time.
\u00a0
Telenor ASA also has a sustainability-linked
\u00a0
committed syndicated revolving credit facility (RCF) of EUR
\u00a0
1.8 billion with maturity in 2025.
\u00a0
The RCF
was undrawn as of 31 December 2022.
\u00a0
When permissible by local rules and regulations,
\u00a0
subsidiaries owned 90% or more are part
\u00a0
of Telenor ASA\u2019s cash management framework
agreements and participate in Telenor ASA\u2019s cash pool
\u00a0
setup. Subsidiaries owned less than 90% have established
\u00a0
separate framework
agreements for banking services.
\u00a0
Telenor
\u00a0
ASA shall
\u00a0
have sufficient
\u00a0
sources of
\u00a0
liquidity
\u00a0
to cover expected
\u00a0
operational
\u00a0
liquidity
\u00a0
needs for
\u00a0
the next
\u00a0
12 months.
\u00a0
Liquidity
\u00a0
requirements
\u00a0
to
fund acquisitions is considered separately.
Maturity profile of the Group\u2019s liabilities (in nominal values)
\u00a0
NOK in millions
31.12.22
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
Not
specified
Interest-bearing
\u00a0
liabilities
Financial Debt
91 267
8 907
14 579
12 498
11 608
7 997
6 701
11 524
717
6 310
-
10 425
-
Other interest-bearing
\u00a0
liabilities
252
252
-
-
-
-
-
-
-
-
-
-
-
Sum of interest-bearing
\u00a0
liabilities
1)
91 518
9 159
14 579
12 498
11 608
7 997
6 701
11 524
717
6 310
-
10 425
-
Non-interest-bearing
\u00a0
liabilities
Trade and other
\u00a0
payables
28 227
28 227
-
-
-
-
-
-
-
-
-
-
-
Other current
\u00a0
non-interest-bearing
liabilities
1 308
1 308
-
-
-
-
-
-
-
-
-
-
-
Derivative
\u00a0
financial instruments
1 841
386
923
224
125
183
-
-
-
-
-
-
-
Other non-current
\u00a0
non-interest-
bearing liabilities
317
-
-
-
-
-
-
-
-
-
-
-
317
Sum of non-interest-bearing
liabilities
31 692
29 920
923
224
125
183
-
-
-
-
-
-
317
Total
123 211
39 080
15 502
12 721
11 733
8 181
6 701
11 524
717
6 310
-
10 425
317
Future interest
\u00a0
payments
9 491
2 030
2 022
1 566
1 043
769
651
445
245
219
155
346
-
Total including
\u00a0
future interest
payments
132 701
41 109
17 524
14 288
12 776
8 950
7 352
11 969
962
6 529
154
10 771
317
NOK in millions
Total as of
31.12.21
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
Not
specified
Interest-bearing
\u00a0
liabilities
Financial Debt
96 008
9 143
8 694
13 236
11 157
11 823
7 840
6 331
11 611
665
5 655
9 854
-
Other interest-bearing
\u00a0
liabilities
134
134
-
-
-
-
-
-
-
-
-
-
-
Sum of interest-bearing
\u00a0
liabilities
96 142
9 276
8 694
13 236
11 157
11 823
7 840
6 331
11 611
665
5 655
9 854
-
Non-interest-bearing
\u00a0
liabilities
Trade and other
\u00a0
payables
32 320
32 320
-
-
-
-
-
-
-
-
-
-
-
Other current
\u00a0
non-interest-bearing
liabilities
1 294
1 294
-
-
-
-
-
-
-
-
-
-
-
Derivative
\u00a0
financial instruments
1 782
675
44
284
216
387
59
54
-
-
63
-
-
Other non-current
\u00a0
non-interest-
bearing liabilities
282
-
-
-
-
-
-
-
-
-
-
-
282
Sum of non-interest-bearing
liabilities
35 677
34 288
44
284
216
387
59
54
-
-
63
-
282
Total
131 818
43 565
8 738
13 520
11 374
12 210
7 898
6 384
11 611
665
5 718
9 854
282
Future interest
\u00a0
payments
8 260
1 322
1 425
1 415
1 056
781
584
462
365
224
196
430
-
Total including
\u00a0
future interest
payments
140 079
44 887
10 163
14 935
12 430
12 991
8 482
6 846
11 976
889
5 913
10 284
282
5)
The maturity tables do not include lease liabilities
\u00a0
related to licences or other lease liabilities. See note
\u00a0
29 for more information on licence commitments
\u00a0
and
lease liabilities.
The Group
\u00a0
is exposed
\u00a0
to interest
\u00a0
rate risk
\u00a0
through funding
\u00a0
and cash
\u00a0
management
\u00a0
activities.
\u00a0
Changes in
\u00a0
interest rates
\u00a0
affect the
\u00a0
fair value
\u00a0
of assets
and liabilities. Interest income and interest expense
\u00a0
in the income statement are influenced by
\u00a0
changes in interest rates in the market. In
\u00a0
2022,
average interest rate for the Group was
\u00a0
1.8%
\u00a0
on interest-bearing liabilities,
\u00a0
excluding lease and licence liabilities (1.6%
\u00a0
in 2021).
The majority of debt issued by the
\u00a0
Group is fixed rate debt. The Group uses interest
\u00a0
rate derivatives to manage interest rate risk
\u00a0
of the debt
portfolio. This typically involves interest rate swaps,
\u00a0
swapping floating interest rates to fixed interest
\u00a0
rates and vice versa.
\u00a0
According to Group Policy, Telenor subsidiaries with
\u00a0
external debt instruments shall maintain a balanced profile
\u00a0
between fixed and floating rate
debt. The portion of the fixed rate shall be between
\u00a0
30% to 70% of external debt. As
\u00a0
of 31 December 2022, the portion of
\u00a0
fixed rate of Group\u2019s debt
was 58% (50%
\u00a0
as of 31. December 2021). For Telenor ASA the
\u00a0
portion
\u00a0
of fixed rate debt as of 31 December
\u00a0
2022 was 58% (55% as of
\u00a0
31. December
2021).
Effect from the interest rate benchmark reform
\u00a0
The Group is exposed to the interest
\u00a0
rate benchmark reform (IBOR reform) through financial
\u00a0
instruments with exposures from EURIBOR, THBFIX
(Thai Baht)
\u00a0
and USD
\u00a0
Libor interest
\u00a0
rate fixings.
\u00a0
In 2022,
\u00a0
dtac has
\u00a0
converted
\u00a0
part of the
\u00a0
exposure
\u00a0
from THBFIX
\u00a0
to THOR (Thai
\u00a0
Overnight
\u00a0
Repurchase
Rate) trough
\u00a0
issuance
\u00a0
of new bonds
\u00a0
or conversion
\u00a0
of legacy
\u00a0
derivatives.
\u00a0
Outside of
\u00a0
these agreements
\u00a0
in Thailand,
\u00a0
there are
\u00a0
no other effects
\u00a0
on the
Group\u2019s consolidated financial statements as a result
\u00a0
of the IBOR reform. The Group has
\u00a0
signed ISDA Fallback Protocol and supplement as part
\u00a0
of
the transition
\u00a0
plan to the
\u00a0
alternative
\u00a0
rates, further
\u00a0
Group is
\u00a0
in dialogue
\u00a0
with counterparties
\u00a0
about the
\u00a0
IBOR reform,
\u00a0
and this has
\u00a0
not resulted
\u00a0
in
changes to
\u00a0
the Group\u2019s
\u00a0
risk management
\u00a0
strategy.
The table
\u00a0
below shows
\u00a0
the financial
\u00a0
instruments
\u00a0
impacted
\u00a0
by interest
\u00a0
rate benchmark
\u00a0
reform as
\u00a0
of 31 December
\u00a0
2022:
Nominal amount
NOK in millions
Bonds
EURIBOR 12 months
72 217
THBFIX 6 months
14 325
86 542
EURIBOR 6 months
21 578
EURIBOR 3 months
12 631
THBFIX 6 months
2 418
USD LIBOR 6 months
-
USD LIBOR 3 months
4 607
41 235
Cross Currency
\u00a0
Swaps
EURIBOR 6 months
11 052
EURIBOR 3 months
14 089
USD LIBOR 3 months
16 004
41 146
Derivative instruments designated as fair value hedging instruments
The majority of debt is issued using fixed
\u00a0
rate bonds. In order to manage interest rate
\u00a0
risk, a portion of the debt may be
\u00a0
swapped to floating interest
rate by using interest rate swaps. Fair value
\u00a0
hedge accounting is applied when hedge accounting
\u00a0
criteria are met. There is an economic relationship
between the hedged items and the hedging instruments,
\u00a0
as the terms of the interest rate
\u00a0
swaps match the terms of the fixed
\u00a0
rate bonds (i.e.,
notional amount, maturity, payment and rate set
\u00a0
dates).
\u00a0
Effectiveness
\u00a0
testing is
\u00a0
performed
\u00a0
using the
\u00a0
hypothetical
\u00a0
derivative
\u00a0
method and
\u00a0
compares
\u00a0
changes in
\u00a0
fair value
\u00a0
of the hedging
\u00a0
instrument
\u00a0
against
the changes in fair value of the
\u00a0
hedged item attributable to the hedged risk. Hedge
\u00a0
ineffectiveness in fair value hedges can arise
\u00a0
from:
\u00a0
\u25cf
Different interest rate curve applied to discount
\u00a0
the hedged items and hedging instruments.
\u00a0
\u25cf
Differences
\u00a0
in timing
\u00a0
of cash flows
\u00a0
of the hedged
\u00a0
items and
\u00a0
hedging instruments.
\u00a0
The table
\u00a0
below shows
\u00a0
the effects
\u00a0
of the Group\u2019s
\u00a0
fair value
hedges.
\u25cf
The effects of the forthcoming IBOR reforms
\u00a0
because these might take effect at a
\u00a0
different time and have a different impact on the
\u00a0
hedged
item (the fixed rate debt) and the hedging instruments (the interest
\u00a0
rate swaps used to hedge the debt).
The change in fair value of the
\u00a0
hedging instrument and the hedged item is recognised
\u00a0
on the line item Net change in fair value
\u00a0
of hedging
instruments and hedged items under net financial
\u00a0
income (expenses) in the income statement, see
\u00a0
also note 9.
\u00a0
Fair value hedging relationships
\u00a0
NOK in millions
2022
2021
Net gain /
\u00a0
(loss) recognised
\u00a0
in the income
\u00a0
statement on
\u00a0
hedged items
4 118
1 280
Net gain /
\u00a0
(loss) recognised
\u00a0
in the income
\u00a0
statement on
\u00a0
hedging instruments
(4 317)
(1 323)
Amount of hedge
\u00a0
ineffectiveness
(200)
(44)
Financial instruments designated as hedging instruments in fair value hedges
\u00a0
are classified on the line items Other non-current
\u00a0
assets and Other
current financial assets in the statement of
\u00a0
financial position, see note 27,
\u00a0
and current and non-current interest-bearing
\u00a0
liabilities, see note 30:
2022
2021
NOK in millions
Assets
Liabilities
Assets
Liabilities
As of 31 December
Nominal amounts
\u00a0
fair value hedge
\u00a0
instruments
37 424
-
42 278
-
Fair values
\u00a0
of fair value
\u00a0
hedge instruments
27
(3 663)
1 071
(120)
The following
\u00a0
table shows
\u00a0
the maturity
\u00a0
profile
\u00a0
of the Group\u2019s
\u00a0
fair value
\u00a0
hedge instruments
\u00a0
(in nominal
\u00a0
values):
NOK in millions
Total
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
As of 31 December
\u00a0
2022
(2 416)
(524)
(528)
(468)
(375)
(256)
(144)
(46)
(19)
(19)
(19)
(19)
As of 31 December
\u00a0
2021
2 148
524
378
369
321
203
119
91
79
13
13
40
The terms
\u00a0
of the fixed
\u00a0
rate receive
\u00a0
leg of the
\u00a0
interest rate
\u00a0
swaps designated
\u00a0
as fair
\u00a0
value hedge
\u00a0
instruments
\u00a0
match the
\u00a0
terms of the
\u00a0
fixed rate
\u00a0
pay
leg of the hedged items. The average interest
\u00a0
rate terms of the floating pay legs of
\u00a0
the interest rate swaps are EURIBOR 3/6 months +
\u00a0
72 basis
points (+
\u00a0
71 basis
\u00a0
points in
\u00a0
2021) for
\u00a0
EUR denominated
\u00a0
swaps,
\u00a0
and THBFIX
\u00a0
+ 146 basis
\u00a0
points (+
\u00a0
140 basis
\u00a0
points in
\u00a0
2021) and
\u00a0
THOR + 143
\u00a0
basis points
(n.a. in 2021) for THB denominated swaps.
The table
\u00a0
below shows
\u00a0
the carrying
\u00a0
amounts of
\u00a0
the Group\u2019s
\u00a0
fair value
\u00a0
hedge items,
\u00a0
which are
\u00a0
recognised
\u00a0
on the line
\u00a0
items Non-current
\u00a0
interest-
bearing liabilities and Current interest-bearing liabilities in the statement
\u00a0
of financial position:
NOK in millions
2022
2021
As of 31 December
Carrying amount
\u00a0
of hedged items
\u00a0
recognised in
\u00a0
the statement
\u00a0
of financial
\u00a0
position
33 004
43 003
Fair value
\u00a0
hedge adjustments
\u00a0
included in the
\u00a0
carrying amount
\u00a0
of the hedged
\u00a0
items
(3 288)
825
Interest rate risk sensitivity analysis
\u00a0
The Group
\u00a0
calculates
\u00a0
the sensitivity
\u00a0
on the change
\u00a0
in fair
\u00a0
value of
\u00a0
assets and
\u00a0
liabilities
\u00a0
of a defined
\u00a0
parallel
\u00a0
shift in
\u00a0
the yield
\u00a0
curve of
\u00a0
the relevant
currencies.
\u00a0
For each
\u00a0
simulation,
\u00a0
the same
\u00a0
shifts in
\u00a0
interest rates
\u00a0
are used
\u00a0
for all currencies.
\u00a0
The sensitivity
\u00a0
analysis
\u00a0
is run only
\u00a0
for assets
\u00a0
and
liabilities
\u00a0
that represent
\u00a0
significant
\u00a0
interest-bearing
\u00a0
positions.
\u00a0
Due to debt
\u00a0
instruments
\u00a0
the net position
\u00a0
is a liability.
\u00a0
Since hedge
\u00a0
accounting
\u00a0
is
applied and interest-bearing debt is measured at amortised cost,
\u00a0
the full effect of change in fair
\u00a0
value is not recognised in the income statement.
This is
\u00a0
shown in
\u00a0
the table
\u00a0
below:
2022
2021
NOK in millions
Yield curve
\u00a0
increase
50 Basis points
Yield curve
\u00a0
decrease
50 Basis points
Yield curve
\u00a0
increase
50 Basis points
Yield curve
\u00a0
decrease
50 Basis points
Reduction (increase)
\u00a0
in fair value
\u00a0
of net liabilities
1 225
(1 278)
1 629
(1 709)
Gain (loss)
\u00a0
in the income
\u00a0
statement
66
(69)
41
(44)
Sensitivity analysis of change in floating interest rates
\u00a0
on net financial items in the income statement:
2022
2021
NOK in millions
Yield curve
\u00a0
increase
50 Basis points
Yield curve
\u00a0
decrease
50 Basis points
Yield curve
\u00a0
increase
50 Basis points
Yield curve
\u00a0
decrease
50 Basis points
Gain (loss)
\u00a0
in the income
\u00a0
statement
(399)
399
(491)
491
The Group is exposed to changes in
\u00a0
the value of NOK relative to other currencies.
\u00a0
The carrying amount of the Group\u2019s net investments
\u00a0
in foreign
entities
\u00a0
and proceeds
\u00a0
from these
\u00a0
investments
\u00a0
varies with
\u00a0
changes in
\u00a0
the foreign
\u00a0
exchange
\u00a0
rate. The
\u00a0
net income
\u00a0
of the Group
\u00a0
is also affected
\u00a0
by
currency fluctuations, as the profit and losses
\u00a0
from foreign operations are translated into NOK
\u00a0
using average exchange rates for the period.
Exchange rate risk related to some net
\u00a0
investments in foreign operations is partly hedged
\u00a0
by issuing debt instruments in the currencies involved or
correlated currencies when this
\u00a0
is considered appropriate. Combinations of money market
\u00a0
instruments (Commercial Paper and bonds) and
derivatives
\u00a0
(foreign
\u00a0
exchange
\u00a0
forward contracts
\u00a0
and cross
\u00a0
currency
\u00a0
swaps) are
\u00a0
used for
\u00a0
this purpose.
\u00a0
Short-term
\u00a0
currency
\u00a0
swaps are
\u00a0
used for
liquidity management purposes. Net investment hedge accounting
\u00a0
is applied when possible.
Exchange
\u00a0
rate risk
\u00a0
also arises
\u00a0
when Telenor
\u00a0
ASA or any
\u00a0
of its subsidiaries
\u00a0
enter into
\u00a0
transactions
\u00a0
or holds
\u00a0
monetary
\u00a0
items denominated
\u00a0
in other
currencies than their own functional currency. In
\u00a0
accordance with Group Policy, committed cash flows in
\u00a0
foreign currency equivalent to NOK 300
million or above are evaluated for hedging.
Financial instruments designated as hedging instruments of net investment in
\u00a0
foreign operations
As of 31 December 2022 and 2021,
\u00a0
material hedging positions are designated as net
\u00a0
investment hedges.
There is an economic relationship between the hedged items
\u00a0
and the hedging instruments as the net
\u00a0
investment creates a translation risk that will
match the
\u00a0
foreign
\u00a0
exchange
\u00a0
risk on the
\u00a0
debt and
\u00a0
derivatives
\u00a0
designated
\u00a0
as hedging
\u00a0
instruments.
Net investment hedging is mainly applied in currencies that
\u00a0
have well-functioning financial markets, but the Group
\u00a0
may also designate debt in
correlated currencies as hedging instruments to hedge foreign
\u00a0
exchange risk.
The Group has established hedge ratios to match
\u00a0
the underlying risk of the hedging instruments
\u00a0
with the hedged risk component. Hedge
ineffectiveness may arise when the amount of
\u00a0
the investment in the foreign subsidiary becomes
\u00a0
lower than the amount of the debt
\u00a0
and derivatives
designated as hedging instruments. There was no
\u00a0
ineffectiveness in the years ending 31 December 2022 and 2021.
For additional information and a reconciliation of the
\u00a0
net investment hedge balance in equity, see
\u00a0
note 28.
\u00a0
Net investment hedging relationships
NOK in millions
2022
2021
Amount recognised
\u00a0
directly to other
\u00a0
comprehensive
\u00a0
income (OCI)
(1 402)
2 447
Amount reclassified
\u00a0
from OCI to the
\u00a0
income statement
\u00a0
on disposal
233
-
Net investment hedging was performed for the
\u00a0
investment in Bangladesh using USD denominated instruments,
\u00a0
but hedging was discontinued due
to loss of economic relationship during 2022.
\u00a0
As of 31 December 2022, the remaining balance included in
\u00a0
the net investment hedge reserve was
Interest-bearing debt and
\u00a0
derivatives designated as hedging instruments in net
\u00a0
investment hedges (only effective part of instruments is
\u00a0
included):
2022
2021
NOK in millions
Debt
Derivatives
Debt
Derivatives
As of 31 December
Nominal amounts
\u00a0
net investment
\u00a0
hedge instruments
(50 533)
8 372
(54 232)
9 184
Fair value
\u00a0
net investment
\u00a0
hedge instruments
(44 000)
(974)
(55 997)
(1 273)
Debt designated as hedging instruments in net
\u00a0
investment hedges are recognised on the line
\u00a0
items Non-current interest-bearing
\u00a0
liabilities and
Current interest-bearing
\u00a0
liabilities in the statement of financial position.
\u00a0
Classification
\u00a0
of derivatives
\u00a0
designated
\u00a0
for net investment
\u00a0
hedge in
\u00a0
the consolidated
\u00a0
statement
\u00a0
of financial
\u00a0
position:
NOK in millions
2022
2021
As of 31 December
Other non-current
\u00a0
assets
713
27
Other financial
\u00a0
current assets
2
320
Non-current non-interest-bearing
\u00a0
financial liabilities
(1 306)
(950)
Current non-interest-bearing
\u00a0
liabilities
(382)
(669)
Fair value net
\u00a0
investment hedge
\u00a0
instruments
(974)
(1 273)
The following
\u00a0
table shows
\u00a0
the maturity
\u00a0
profile (in
\u00a0
nominal values)
\u00a0
of the Group\u2019s
\u00a0
net investment
\u00a0
hedge instruments
\u00a0
(only effective
\u00a0
part of
instruments is included):
NOK in millions
Total
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
As of 31 December
\u00a0
2022
(44 646)
(6 084)
(2 766)
(1 284)
(6 800)
(2 653)
(4 194)
(8 233)
(130)
(4 137)
(105)
(8 259)
As of 31 December
\u00a0
2021
(49 304)
(5 688)
(1 903)
(3 707)
(2 449)
(7 126)
(3 057)
(4 223)
(8 259)
(134)
(4 372)
(8 386)
Average currency rates in cross currency swaps
\u00a0
designated as net investment hedge instruments were
\u00a0
NOK/USD n.a. (8.57
\u00a0
in 2021), USD/EUR 1.15
(1.16 in 2021), SEK/EUR 10.47
\u00a0
(10.47 in 2021) and NOK/EUR 10.83
\u00a0
(10.83 in 2021) in 2022. In 2022, average currency
\u00a0
rates in foreign exchange contracts
designated as net investment hedge instruments were
\u00a0
NOK/SEK 0.95 (1.00 in 2021), NOK/EUR 10.57 (9.98
\u00a0
in 2021), USD/EUR n.a. (1.16
\u00a0
in 2021),
USD/MYR 0.22
\u00a0
(0.24 in
\u00a0
2021) and
\u00a0
USD/THB 0.03
\u00a0
(0.03 in 2021).
Exchange
\u00a0
rate risk
\u00a0
sensitivity
\u00a0
analysis
\u00a0
This analysis does not consider correlation between
\u00a0
currencies. Empirical studies confirm substantial diversification effect across
\u00a0
the currencies
that the Group
\u00a0
is exposed
\u00a0
to.
Effects on net currency gains (losses)
Currency gains and losses on monetary items
\u00a0
in foreign currency are recognised in the
\u00a0
income statements of Telenor ASA and its
\u00a0
subsidiaries. Net
currency
\u00a0
gains (losses)
\u00a0
in foreign
\u00a0
subsidiaries
\u00a0
are translated
\u00a0
to NOK in
\u00a0
the consolidated
\u00a0
income statement.
\u00a0
The table
\u00a0
below shows
\u00a0
the effect
\u00a0
on
consolidated net currency losses of 10% depreciation
\u00a0
in functional currencies in the Group, keeping other currencies
\u00a0
constant (only significant
exposures
\u00a0
are included
\u00a0
in the table):
Monetary Item
\u00a0
Currency
2022
2021
NOK in millions
EUR
SEK
USD
Other
EUR
SEK
USD
Other
Depreciating
\u00a0
Functional Currency
NOK
-
(510)
(677)
(104)
(146)
(443)
(1 212)
(116)
Effects due to foreign exchange translations on other comprehensive income
Translation
\u00a0
of subsidiaries
\u00a0
from their
\u00a0
functional
\u00a0
currencies
\u00a0
into the presentation
\u00a0
currency
\u00a0
of the Group
\u00a0
(NOK) will
\u00a0
impact the
\u00a0
Group\u2019s other
comprehensive income (OCI) and equity. If NOK
\u00a0
had weakened by 10% against all other
\u00a0
functional currencies of the Group, the change
\u00a0
in the
carrying amount of consolidated equity as of 31
\u00a0
December 2022, including effects of net investment
\u00a0
hedge, would have been an increase of
approximately
\u00a0
NOK 2.1
\u00a0
billion (increase
\u00a0
of NOK 2.2
\u00a0
billion as
\u00a0
of 31 December
\u00a0
2021).
The table
\u00a0
below shows
\u00a0
the impact
\u00a0
on OCI of
\u00a0
net investment
\u00a0
hedge (NIH)
\u00a0
instruments
\u00a0
if the functional
\u00a0
currency
\u00a0
weakened
\u00a0
by 10%.
2022
2021
NOK in millions
EUR
SEK
USD
Other
EUR
SEK
USD
Other
Currency effect
\u00a0
on OCI (before
\u00a0
tax) of NIH instruments
NOK
(2 420)
(1 211)
-
(585)
(2 474)
(1 128)
(267)
(636)
Effect on other
\u00a0
comprehensive
\u00a0
income (OCI)
-
-
-
(4 216)
-
-
-
(4 505)
Effects due to foreign exchange translations on net income
\u00a0
Translation
\u00a0
of net income
\u00a0
from subsidiaries
\u00a0
with functional
\u00a0
currency
\u00a0
other than
\u00a0
NOK, also
\u00a0
represents
\u00a0
a currency
\u00a0
exposure
\u00a0
for the Group\u2019s
\u00a0
reported
figures.
\u00a0
If the presentation
\u00a0
currency
\u00a0
(NOK) had
\u00a0
weakened
\u00a0
/ strengthened
\u00a0
by 10% against
\u00a0
all other
\u00a0
currencies
\u00a0
included
\u00a0
in the analysis,
\u00a0
net income
\u00a0
for
the Group would have been NOK 0.6
\u00a0
billion higher / lower in 2022 (NOK 0.3
\u00a0
billion in 2021).
\u00a0
Credit risk is the loss that the Group
\u00a0
would suffer if a counterparty fails to
\u00a0
perform its financial obligations. The Group considers its
\u00a0
maximum
exposure
\u00a0
to credit
\u00a0
risk to be
\u00a0
as follows:
Maximum credit exposure
NOK in millions
2022
2021
Cash and cash
\u00a0
equivalents
9 929
15 223
Bonds and commercial
\u00a0
papers > 3 months
\u00a0
(note 27)
277
327
Financial derivatives
\u00a0
(note 27)
1 017
1 333
Current interest-bearing
\u00a0
receivables
\u00a0
\u2013 deferred payment
\u00a0
from disposal
\u00a0
(note 19)
-
998
Trade and other
\u00a0
current financial
\u00a0
receivables
\u00a0
(note 19)
16 480
17 286
The Group\u2019s credit risks largely arise from
\u00a0
trade receivables, financial derivatives and cash and
\u00a0
cash equivalents.
\u00a0
Credit risk
\u00a0
from cash
\u00a0
and cash
\u00a0
equivalents
\u00a0
is managed
\u00a0
by the Group\u2019s
\u00a0
Treasury
\u00a0
department
\u00a0
in accordance
\u00a0
with the
\u00a0
principles
\u00a0
defined in
\u00a0
the Group
Policy Treasury. Cash deposits are only made with approved
\u00a0
counterparties and in accordance with approved credit limits per
\u00a0
counterparty.
Counterparty
\u00a0
credit limits
\u00a0
for core
\u00a0
banks are
\u00a0
reviewed
\u00a0
by the Group\u2019s
\u00a0
Board of
\u00a0
Directors
\u00a0
on a regular
\u00a0
basis. The
\u00a0
limits are
\u00a0
set to minimise
\u00a0
the
concentration of risks and therefore mitigate financial loss
\u00a0
through a counterparty\u2019s potential payment default.
\u00a0
Credit risk arising from financial derivatives and
\u00a0
cash deposits is managed through diversification, internal
\u00a0
risk assessment and credit scoring, as
well as credit risk mitigation tools. The
\u00a0
main risk mitigation tools include legal netting and
\u00a0
collateral agreements.
\u00a0
Credit risk
\u00a0
related to
\u00a0
trade receivables
\u00a0
is assessed
\u00a0
to be limited
\u00a0
due to the
\u00a0
high number
\u00a0
of customers
\u00a0
in the Group\u2019s
\u00a0
customer
\u00a0
base. As
\u00a0
such, no
further credit
\u00a0
risk provision
\u00a0
is required
\u00a0
in excess
\u00a0
of the normal
\u00a0
provision
\u00a0
for bad
\u00a0
and doubtful
\u00a0
receivables.
\u00a0
See note
\u00a0
19 for information
\u00a0
on
receivables in terms of age distribution and
\u00a0
provision for bad debt. Credit risk related to
\u00a0
sale of handsets on instalment plans, where
\u00a0
the effect of
discounting is considered material, is also assessed
\u00a0
to be limited. Credit risk related to
\u00a0
such arrangements are embedded in the discount rate and
reflected
\u00a0
as reduced
\u00a0
revenue.
As of 31
\u00a0
December
\u00a0
2022, NOK
\u00a0
264 million
\u00a0
was posted
\u00a0
as cash collateral
\u00a0
(receivable).
\u00a0
As of 31 December
\u00a0
2021, NOK
\u00a0
658 million
\u00a0
was posted
\u00a0
as cash
collateral (receivable).
In recent
\u00a0
years, Telenor
\u00a0
has measured
\u00a0
leverage
\u00a0
as the ratio
\u00a0
of Net debt
\u00a0
to EBITDA
\u00a0
before other
\u00a0
items. Following
\u00a0
the structural
\u00a0
changes in
\u00a0
the
portfolio,
\u00a0
and triggered
\u00a0
by closing
\u00a0
of the merger
\u00a0
in Malaysia,
\u00a0
Telenor measures
\u00a0
the leverage
\u00a0
from 2022
\u00a0
as the ratio
\u00a0
of Net debt
\u00a0
to EBITDA
\u00a0
before
other items and dividends from associated companies
\u00a0
and joint ventures. Telenor aims to maintain
\u00a0
a solid balance sheet through
\u00a0
keeping leverage
ratio in the range of 1.8x to
\u00a0
2.3x maintain financial flexibility and ensure cost efficient
\u00a0
funding (see page 180 for alternative performance measures).
As of 31 December 2022,
\u00a0
the reported leverage ratio was 2.2x
\u00a0
(2.1x
\u00a0
as of 31 December 2021).
\u00a0
The targeted capital structure provides a good
\u00a0
balance
between shareholder return and a solid balance
\u00a0
sheet with stable access to global debt markets,
\u00a0
while also supporting Telenor\u2019s strategic priorities.
As of 31 December 2022, Telenor ASA\u2019s long-term credit
\u00a0
rating was \u201cBaa1/stable outlook\u201d
\u00a0
by Moody\u2019s Investors Service and \u201cA-/stable outlook\u201d
\u00a0
by
Standard & Poor\u2019s (S&P). During 2022, Moody\u2019s changed
\u00a0
their rating and outlook from \u201cA3/negative watch\u201d
\u00a0
to \u201cBaa1/stable outlook\u201d, while S&P\u2019s
rating and outlook were unchanged throughout
\u00a0
the year.
\u00a0
Key elements
\u00a0
of the Group\u2019s
\u00a0
capital
\u00a0
structure
\u00a0
include
\u00a0
interest-bearing
\u00a0
debt as
\u00a0
disclosed
\u00a0
in note 30,
\u00a0
cash and cash
\u00a0
equivalents
\u00a0
as disclosed
\u00a0
in note
20 and equity
\u00a0
attributable
\u00a0
to the shareholders
\u00a0
of Telenor
\u00a0
ASA as presented
\u00a0
in the consolidated
\u00a0
statement
\u00a0
of changes
\u00a0
in equity
\u00a0
and in note
\u00a0
28.
\u00a0
In order
\u00a0
to adjust
\u00a0
the capital
\u00a0
structure,
\u00a0
the Group
\u00a0
may acquire
\u00a0
or sell own
\u00a0
shares, distribute
\u00a0
dividends
\u00a0
to shareholders,
\u00a0
return capital
\u00a0
to
shareholders or issue new shares. In 2022, Telenor\u2019s
\u00a0
shareholder remuneration via dividend was NOK 13.0 billion
\u00a0
comprised of ordinary dividends
paid out in June 2022 (NOK 5.00 per
\u00a0
share) and October 2022 (NOK 4.30 per share).
\u00a0
For the financial
\u00a0
year 2022,
\u00a0
the Telenor
\u00a0
Board of
\u00a0
Directors
\u00a0
will propose
\u00a0
an ordinary
\u00a0
dividend
\u00a0
of NOK 9.40
\u00a0
per share
\u00a0
to be resolved
\u00a0
by the Annual
General Meeting in May 2023 and paid out in
\u00a0
two tranches of NOK 5.00 and NOK 4.40
\u00a0
per share in May 2023
\u00a0
and October 2023, respectively. The
total ordinary dividend amount proposed for the
\u00a0
financial year 2022 is NOK 13.2 billion.
\u00a0
Following the successful transaction of divesting 30%
\u00a0
of Telenor Fiber AS, Telenor Group has decided to
\u00a0
initiate a 2023-2024 share buyback
programme. The Board of Directors of Telenor
\u00a0
ASA held an extraordinary general meeting on
\u00a0
26 January 2023 asking the General Meeting
\u00a0
for a
share buyback
\u00a0
authorisation.
\u00a0
The programme
\u00a0
size will
\u00a0
be limited
\u00a0
to NOK 3.7
\u00a0
billion and
\u00a0
up to 47
\u00a0
million shares.
\u00a0
Telenor\u2019s shareholder remuneration policy
\u00a0
is to aim for a year-on-year growth in
\u00a0
dividend per share, where the annual dividends
\u00a0
are paid in two
instalments. Buyback of own shares or extraordinary
\u00a0
dividend pay-outs might also be used as a
\u00a0
measure to reach a targeted leverage.
Liquidity
\u00a0
risk is the
\u00a0
ability
\u00a0
to ensure
\u00a0
appropriate
\u00a0
funding.
\u00a0
The Group
\u00a0
emphasises
\u00a0
financial
\u00a0
flexibility,
\u00a0
and an important
\u00a0
part of this
\u00a0
is to minimise
liquidity risk through ensuring access to a
\u00a0
diversified set of funding sources. Debt issued in
\u00a0
the international capital market is predominately issued
under the existing EMTN programme (Euro Medium
\u00a0
Term Note) to secure longer dated funding
\u00a0
and under existing ECP programme (Euro
Commercial Paper) to secure shorter dated funding
\u00a0
up to 12 months. In addition to
\u00a0
these uncommitted loan programmes, the Norwegian domestic
capital market
\u00a0
is used from
\u00a0
time to time.
\u00a0
Telenor ASA also has a sustainability-linked
\u00a0
committed syndicated revolving credit facility (RCF) of EUR
\u00a0
1.8 billion with maturity in 2025.
\u00a0
The RCF
was undrawn as of 31 December 2022.
\u00a0
When permissible by local rules and regulations,
\u00a0
subsidiaries owned 90% or more are part
\u00a0
of Telenor ASA\u2019s cash management framework
agreements and participate in Telenor ASA\u2019s cash pool
\u00a0
setup. Subsidiaries owned less than 90% have established
\u00a0
separate framework
agreements for banking services.
\u00a0
Telenor
\u00a0
ASA shall
\u00a0
have sufficient
\u00a0
sources of
\u00a0
liquidity
\u00a0
to cover expected
\u00a0
operational
\u00a0
liquidity
\u00a0
needs for
\u00a0
the next
\u00a0
12 months.
\u00a0
Liquidity
\u00a0
requirements
\u00a0
to
fund acquisitions is considered separately.
Maturity profile of the Group\u2019s liabilities (in nominal values)
\u00a0
NOK in millions
31.12.22
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
Not
specified
Interest-bearing
\u00a0
liabilities
Financial Debt
91 267
8 907
14 579
12 498
11 608
7 997
6 701
11 524
717
6 310
-
10 425
-
Other interest-bearing
\u00a0
liabilities
252
252
-
-
-
-
-
-
-
-
-
-
-
Sum of interest-bearing
\u00a0
liabilities
1)
91 518
9 159
14 579
12 498
11 608
7 997
6 701
11 524
717
6 310
-
10 425
-
Non-interest-bearing
\u00a0
liabilities
Trade and other
\u00a0
payables
28 227
28 227
-
-
-
-
-
-
-
-
-
-
-
Other current
\u00a0
non-interest-bearing
liabilities
1 308
1 308
-
-
-
-
-
-
-
-
-
-
-
Derivative
\u00a0
financial instruments
1 841
386
923
224
125
183
-
-
-
-
-
-
-
Other non-current
\u00a0
non-interest-
bearing liabilities
317
-
-
-
-
-
-
-
-
-
-
-
317
Sum of non-interest-bearing
liabilities
31 692
29 920
923
224
125
183
-
-
-
-
-
-
317
Total
123 211
39 080
15 502
12 721
11 733
8 181
6 701
11 524
717
6 310
-
10 425
317
Future interest
\u00a0
payments
9 491
2 030
2 022
1 566
1 043
769
651
445
245
219
155
346
-
Total including
\u00a0
future interest
payments
132 701
41 109
17 524
14 288
12 776
8 950
7 352
11 969
962
6 529
154
10 771
317
NOK in millions
Total as of
31.12.21
< 1 year
2 years
3 years
4 years
5 years
6 years
7 years
8 years
9 years
10 years
>10 years
Not
specified
Interest-bearing
\u00a0
liabilities
Financial Debt
96 008
9 143
8 694
13 236
11 157
11 823
7 840
6 331
11 611
665
5 655
9 854
-
Other interest-bearing
\u00a0
liabilities
134
134
-
-
-
-
-
-
-
-
-
-
-
Sum of interest-bearing
\u00a0
liabilities
96 142
9 276
8 694
13 236
11 157
11 823
7 840
6 331
11 611
665
5 655
9 854
-
Non-interest-bearing
\u00a0
liabilities
Trade and other
\u00a0
payables
32 320
32 320
-
-
-
-
-
-
-
-
-
-
-
Other current
\u00a0
non-interest-bearing
liabilities
1 294
1 294
-
-
-
-
-
-
-
-
-
-
-
Derivative
\u00a0
financial instruments
1 782
675
44
284
216
387
59
54
-
-
63
-
-
Other non-current
\u00a0
non-interest-
bearing liabilities
282
-
-
-
-
-
-
-
-
-
-
-
282
Sum of non-interest-bearing
liabilities
35 677
34 288
44
284
216
387
59
54
-
-
63
-
282
Total
131 818
43 565
8 738
13 520
11 374
12 210
7 898
6 384
11 611
665
5 718
9 854
282
Future interest
\u00a0
payments
8 260
1 322
1 425
1 415
1 056
781
584
462
365
224
196
430
-
Total including
\u00a0
future interest
payments
140 079
44 887
10 163
14 935
12 430
12 991
8 482
6 846
11 976
889
5 913
10 284
282
5)
The maturity tables do not include lease liabilities
\u00a0
related to licences or other lease liabilities. See note
\u00a0
29 for more information on licence commitments
\u00a0
and
lease liabilities.
Credit risk is the loss that the Group
\u00a0
would suffer if a counterparty fails to
\u00a0
perform its financial obligations. The Group considers its
\u00a0
maximum
exposure
\u00a0
to credit
\u00a0
risk to be
\u00a0
as follows:
Maximum credit exposure
NOK in millions
2022
2021
Cash and cash
\u00a0
equivalents
9 929
15 223
Bonds and commercial
\u00a0
papers > 3 months
\u00a0
(note 27)
277
327
Financial derivatives
\u00a0
(note 27)
1 017
1 333
Current interest-bearing
\u00a0
receivables
\u00a0
\u2013 deferred payment
\u00a0
from disposal
\u00a0
(note 19)
-
998
Trade and other
\u00a0
current financial
\u00a0
receivables
\u00a0
(note 19)
16 480
17 286
The Group\u2019s credit risks largely arise from
\u00a0
trade receivables, financial derivatives and cash and
\u00a0
cash equivalents.
\u00a0
Credit risk
\u00a0
from cash
\u00a0
and cash
\u00a0
equivalents
\u00a0
is managed
\u00a0
by the Group\u2019s
\u00a0
Treasury
\u00a0
department
\u00a0
in accordance
\u00a0
with the
\u00a0
principles
\u00a0
defined in
\u00a0
the Group
Policy Treasury. Cash deposits are only made with approved
\u00a0
counterparties and in accordance with approved credit limits per
\u00a0
counterparty.
Counterparty
\u00a0
credit limits
\u00a0
for core
\u00a0
banks are
\u00a0
reviewed
\u00a0
by the Group\u2019s
\u00a0
Board of
\u00a0
Directors
\u00a0
on a regular
\u00a0
basis. The
\u00a0
limits are
\u00a0
set to minimise
\u00a0
the
concentration of risks and therefore mitigate financial loss
\u00a0
through a counterparty\u2019s potential payment default.
\u00a0
Credit risk arising from financial derivatives and
\u00a0
cash deposits is managed through diversification, internal
\u00a0
risk assessment and credit scoring, as
well as credit risk mitigation tools. The
\u00a0
main risk mitigation tools include legal netting and
\u00a0
collateral agreements.
\u00a0
Credit risk
\u00a0
related to
\u00a0
trade receivables
\u00a0
is assessed
\u00a0
to be limited
\u00a0
due to the
\u00a0
high number
\u00a0
of customers
\u00a0
in the Group\u2019s
\u00a0
customer
\u00a0
base. As
\u00a0
such, no
further credit
\u00a0
risk provision
\u00a0
is required
\u00a0
in excess
\u00a0
of the normal
\u00a0
provision
\u00a0
for bad
\u00a0
and doubtful
\u00a0
receivables.
\u00a0
See note
\u00a0
19 for information
\u00a0
on
receivables in terms of age distribution and
\u00a0
provision for bad debt. Credit risk related to
\u00a0
sale of handsets on instalment plans, where
\u00a0
the effect of
discounting is considered material, is also assessed
\u00a0
to be limited. Credit risk related to
\u00a0
such arrangements are embedded in the discount rate and
reflected
\u00a0
as reduced
\u00a0
revenue.
NOTE 32
Fair values of financial instruments
Based on the characteristics of the financial instruments that are recognised
\u00a0
in the financial statements, the
financial instruments are grouped into classes and categories.
\u00a0
The estimated fair values of Telenor\u2019s financial
instruments are based on available market prices and various
\u00a0
valuation methodologies as summarised in this note.
\u00a0
Fair value
\u00a0
hierarchy
Telenor
\u00a0
measures fair
\u00a0
values using
\u00a0
the following
\u00a0
fair value
\u00a0
hierarchy
\u00a0
that reflects
\u00a0
the significance
\u00a0
of the inputs
\u00a0
used in measuring
\u00a0
fair value:
Level 1
:
\u00a0
Quoted prices
\u00a0
(unadjusted)
\u00a0
in active
\u00a0
markets for
\u00a0
identical
\u00a0
financial
\u00a0
instruments
Level 2:
\u00a0
Inputs other than quoted prices included within
\u00a0
Level 1 that are observable for assets or
\u00a0
liabilities, either directly (i.e. as prices) or
indirectly (i.e. derived from prices).
\u00a0
Level 3:
\u00a0
Inputs for assets or liabilities that are
\u00a0
not based on observable market data (unobservable
\u00a0
inputs).
Interest-bearing liabilities
Fair values of interest-bearing
\u00a0
liabilities as shown in note 30 are
\u00a0
based on quoted prices where available. Interest-bearing
\u00a0
liabilities that are not
traded in an active market have been
\u00a0
estimated using yield curves which incorporate estimates of
\u00a0
the Telenor ASA credit spread. The credit curves
have been extrapolated using indicative prices on debt
\u00a0
issuance by Telenor ASA for different maturities. The
\u00a0
yield curves have been interpolated
from cash and swap curves observed in
\u00a0
the market for different currencies
\u00a0
and maturities.
\u00a0
Trade receivables and other current and non-current financial assets
For trade receivables and other current receivables,
\u00a0
see note 19 for more information, the
\u00a0
carrying amount is assessed to be a
\u00a0
reasonable
approximation of fair value. The effect of not
\u00a0
discounting is considered to be immaterial for
\u00a0
this class of financial instruments.
\u00a0
Trade payables and other non-interest-bearing
\u00a0
financial liabilities
For trade
\u00a0
payables
\u00a0
and other
\u00a0
non-interest-bearing
\u00a0
financial
\u00a0
liabilities,
\u00a0
see note
\u00a0
24 for more
\u00a0
information,
\u00a0
the carrying
\u00a0
amount is
\u00a0
assessed
\u00a0
to be a
reasonable approximation of fair value. The effect of
\u00a0
not discounting is considered to be insignificant for
\u00a0
this class of financial instruments.
\u00a0
Equity investments
Fair values
\u00a0
for listed
\u00a0
shares as
\u00a0
shown in
\u00a0
note 27 are
\u00a0
based on quoted
\u00a0
prices at
\u00a0
the end of
\u00a0
the reporting
\u00a0
period. Fair
\u00a0
value of
\u00a0
unlisted shares
\u00a0
is
estimated by using commonly used valuation techniques
\u00a0
or measured at cost if the investment
\u00a0
does not have a quoted market price
\u00a0
in an active
market and the fair value cannot be
\u00a0
reliably measured.
\u00a0
Cash and cash equivalents
The fair
\u00a0
value for
\u00a0
this class
\u00a0
of financial
\u00a0
instruments
\u00a0
is assessed
\u00a0
to be equal
\u00a0
to the nominal
\u00a0
amount.
\u00a0
Fair value
\u00a0
of currency
\u00a0
swaps, foreign
\u00a0
currency
\u00a0
forward contracts
\u00a0
and interest
\u00a0
rate swaps
\u00a0
as shown in
\u00a0
note 27 is
\u00a0
estimated
\u00a0
based on calculating
\u00a0
the
net present
\u00a0
value of
\u00a0
future cash
\u00a0
flows, using
\u00a0
interest rate
\u00a0
curves, exchange
\u00a0
rates and
\u00a0
currency
\u00a0
spreads as
\u00a0
of 31 December
\u00a0
2022 and
\u00a0
2021,
respectively.
NOTE 32
Fair values of financial instruments
Based on the characteristics of the financial instruments that are recognised
\u00a0
in the financial statements, the
financial instruments are grouped into classes and categories.
\u00a0
The estimated fair values of Telenor\u2019s financial
instruments are based on available market prices and various
\u00a0
valuation methodologies as summarised in this note.
\u00a0
Fair value
\u00a0
hierarchy
Telenor
\u00a0
measures fair
\u00a0
values using
\u00a0
the following
\u00a0
fair value
\u00a0
hierarchy
\u00a0
that reflects
\u00a0
the significance
\u00a0
of the inputs
\u00a0
used in measuring
\u00a0
fair value:
Level 1
:
\u00a0
Quoted prices
\u00a0
(unadjusted)
\u00a0
in active
\u00a0
markets for
\u00a0
identical
\u00a0
financial
\u00a0
instruments
Level 2:
\u00a0
Inputs other than quoted prices included within
\u00a0
Level 1 that are observable for assets or
\u00a0
liabilities, either directly (i.e. as prices) or
indirectly (i.e. derived from prices).
\u00a0
Level 3:
\u00a0
Inputs for assets or liabilities that are
\u00a0
not based on observable market data (unobservable
\u00a0
inputs).
Interest-bearing liabilities
Fair values of interest-bearing
\u00a0
liabilities as shown in note 30 are
\u00a0
based on quoted prices where available. Interest-bearing
\u00a0
liabilities that are not
traded in an active market have been
\u00a0
estimated using yield curves which incorporate estimates of
\u00a0
the Telenor ASA credit spread. The credit curves
have been extrapolated using indicative prices on debt
\u00a0
issuance by Telenor ASA for different maturities. The
\u00a0
yield curves have been interpolated
from cash and swap curves observed in
\u00a0
the market for different currencies
\u00a0
and maturities.
\u00a0
Trade receivables and other current and non-current financial assets
For trade receivables and other current receivables,
\u00a0
see note 19 for more information, the
\u00a0
carrying amount is assessed to be a
\u00a0
reasonable
approximation of fair value. The effect of not
\u00a0
discounting is considered to be immaterial for
\u00a0
this class of financial instruments.
\u00a0
Trade payables and other non-interest-bearing
\u00a0
financial liabilities
For trade
\u00a0
payables
\u00a0
and other
\u00a0
non-interest-bearing
\u00a0
financial
\u00a0
liabilities,
\u00a0
see note
\u00a0
24 for more
\u00a0
information,
\u00a0
the carrying
\u00a0
amount is
\u00a0
assessed
\u00a0
to be a
reasonable approximation of fair value. The effect of
\u00a0
not discounting is considered to be insignificant for
\u00a0
this class of financial instruments.
\u00a0
Equity investments
Fair values
\u00a0
for listed
\u00a0
shares as
\u00a0
shown in
\u00a0
note 27 are
\u00a0
based on quoted
\u00a0
prices at
\u00a0
the end of
\u00a0
the reporting
\u00a0
period. Fair
\u00a0
value of
\u00a0
unlisted shares
\u00a0
is
estimated by using commonly used valuation techniques
\u00a0
or measured at cost if the investment
\u00a0
does not have a quoted market price
\u00a0
in an active
market and the fair value cannot be
\u00a0
reliably measured.
\u00a0
Cash and cash equivalents
The fair
\u00a0
value for
\u00a0
this class
\u00a0
of financial
\u00a0
instruments
\u00a0
is assessed
\u00a0
to be equal
\u00a0
to the nominal
\u00a0
amount.
\u00a0
Fair value
\u00a0
of currency
\u00a0
swaps, foreign
\u00a0
currency
\u00a0
forward contracts
\u00a0
and interest
\u00a0
rate swaps
\u00a0
as shown in
\u00a0
note 27 is
\u00a0
estimated
\u00a0
based on calculating
\u00a0
the
net present
\u00a0
value of
\u00a0
future cash
\u00a0
flows, using
\u00a0
interest rate
\u00a0
curves, exchange
\u00a0
rates and
\u00a0
currency
\u00a0
spreads as
\u00a0
of 31 December
\u00a0
2022 and
\u00a0
2021,
respectively.
Fair value
\u00a0
hierarchy
Telenor
\u00a0
measures fair
\u00a0
values using
\u00a0
the following
\u00a0
fair value
\u00a0
hierarchy
\u00a0
that reflects
\u00a0
the significance
\u00a0
of the inputs
\u00a0
used in measuring
\u00a0
fair value:
Level 1
:
\u00a0
Quoted prices
\u00a0
(unadjusted)
\u00a0
in active
\u00a0
markets for
\u00a0
identical
\u00a0
financial
\u00a0
instruments
Level 2:
\u00a0
Inputs other than quoted prices included within
\u00a0
Level 1 that are observable for assets or
\u00a0
liabilities, either directly (i.e. as prices) or
indirectly (i.e. derived from prices).
\u00a0
Level 3:
\u00a0
Inputs for assets or liabilities that are
\u00a0
not based on observable market data (unobservable
\u00a0
inputs).
NOTE 33
Guarantees
NOK in millions
2022
2021
Guarantee
\u00a0
obligations
\u00a0
as of 31
\u00a0
December
1 522
2 475
Telenor has provided various types of guarantees
\u00a0
to external parties, including guarantees relating to
\u00a0
partnership agreements, guarantee for the
pension funds
\u00a0
and various
\u00a0
guarantees
\u00a0
for taxes.
\u00a0
Purchased
\u00a0
bank guarantees
\u00a0
are not shown
\u00a0
in the table.
NOTE 34
Consolidation and group companies
\u00a0
Accounting policies
The consolidated financial statements include the financial
\u00a0
statements of Telenor ASA and entities controlled
\u00a0
by Telenor ASA. Control normally
exists when
\u00a0
the Group
\u00a0
has more
\u00a0
than 50%
\u00a0
of the voting
\u00a0
power through
\u00a0
ownership
\u00a0
or agreements,
\u00a0
except where
\u00a0
non-controlling
\u00a0
interests prevent
the exercise of control. Subsidiaries have the
\u00a0
same reporting periods as the parent company
\u00a0
and use consistent accounting policies. Intercompany
transactions, balances, revenues, expenses and unrealised
\u00a0
internal profit or losses are eliminated on consolidation. Non-controlling
\u00a0
interests in
subsidiaries are presented within equity separately from the equity attributable
\u00a0
to the owners of the parent, refer
\u00a0
to note 28. Non-controlling
interests
\u00a0
have been
\u00a0
measured
\u00a0
at the proportionate
\u00a0
fair value
\u00a0
of net identifiable
\u00a0
assets at
\u00a0
the date
\u00a0
of the business
\u00a0
combination
\u00a0
and share
\u00a0
of
changes in
\u00a0
equity since
\u00a0
the date
\u00a0
of the business
\u00a0
combination.
Shares in subsidiaries
Office
in % 2022
in % 2021
Telenor Networks Holding AS
Norway
100.0
100.0
Telenor Global Shared Services AS
\u00a0
Norway
100.0
100.0
Telenor
\u00a0
Communication
\u00a0
II AS
Norway
100.0
100.0
Telenor Mobile Holding AS
\u00a0
Norway
100.0
100.0
Norway
100.0
100.0
Telenor Forsikring AS
Norway
100.0
100.0
Telenor Maritime AS 1)
Norway
98.9
98.9
Norway
100.0
100.0
Cinclus Technology AS
\u00a0
Norway
100.0
100.0
Telenor Digital AS 2)
Norway
0.0
100.0
Telenor Real Estate AS
Norway
100.0
100.0
1)
The remaining
\u00a0
1.1% of shares
\u00a0
in Telenor Maritime
\u00a0
AS are owned by
\u00a0
Telenor Communication
\u00a0
II AS.
2)
Telenor Digital
\u00a0
AS is merged
\u00a0
with Telenor
\u00a0
Linx AS which
\u00a0
is owned by Telenor
\u00a0
Networks Holding
\u00a0
AS in 2022.
Shares in subsidiaries
\u00a0
owned through
\u00a0
subsidiaries
Office
in % 2022
in % 2021
Telenor Networks Holding AS
Norway
100.0
100.0
Telenor Linx AS
Norway
100.0
100.0
Telenor
\u00a0
Svalbard
\u00a0
AS
Norway
100.0
100.0
Norway
100.0
100.0
Telenor Nordic Towers AS
Norway
100.0
100.0
Telenor Satellite AS
Norway
100.0
100.0
Norway
100.0
Telenor Communication II AS
Telenor Financial Services AS
5)
Norway
0.0
100.0
Singapore
100.0
100.0
SnT East
\u00a0
Holding
\u00a0
AS
Norway
100.0
100.0
Telenor
\u00a0
India Private
\u00a0
Ltd
India
100.0
100.0
Norkring Belgi\u00eb N.V.
Belgium
75.0
75.0
Norway
100.0
100.0
Telenor
\u00a0
Marketplace
\u00a0
Invest AS
Norway
100.0
100.0
Telenor South Asia Investment Pte Ltd
6)
Singapore
100.0
0.0
Telenor Mobile Holding AS
Telenor
\u00a0
Mobile Communications
\u00a0
AS
Norway
100.0
100.0
Telenor Danmark Holding A/S
Denmark
100.0
100.0
Sweden
100.0
100.0
Telenor Connexion AB
\u00a0
Sweden
100.0
100.0
Canal Digital
\u00a0
Finland Oy
Finland
100.0
100.0
Telenor Finland Holding Oy
Finland
100.0
100.0
Telenor Maritime AS
Telenor
\u00a0
Maritime
\u00a0
Inc
USA
100.0
100.0
Telenor
\u00a0
Maritime
\u00a0
AB
Sweden
100.0
100.0
Telenor
\u00a0
Maritime
\u00a0
Pte
Singapore
100.0
100.0
Telenor
\u00a0
Maritime
\u00a0
Oy
Finland
100.0
100.0
Telenor Real Estate AS
Telenor Eiendom Harelokken AS
Norway
100.0
100.0
Norway
100.0
100.0
Telenor
\u00a0
M\u00f8re og Romsdal
\u00a0
og Tr\u00f8ndelag
\u00a0
2 AS
Norway
100.0
100.0
Telenor Vestlandet og Rogaland 2 AS
Norway
100.0
100.0
Telenor Agder Vestfold og Telemark 2 AS
Norway
100.0
100.0
Telenor Viken og Innlandet 2 AS
Norway
100.0
100.0
Telenor
\u00a0
\u00d8vre Strandgate
\u00a0
5 2 AS
Norway
100.0
100.0
Telenor L\u00e5veveien 55 AS
Norway
100.0
100.0
Telenor Jel\u00f8y Radio AS
Norway
100.0
100.0
Telenor Tryvann Radio AS
Norway
100.0
100.0
Telenor Festekontrakter AS
Norway
100.0
100.0
Telenor Linx AS
2)
Norway
100.0
100.0
1)
The company was presented as Telenor Global Services
\u00a0
AS earlier.
2)
Telenor Digital AS is merged with Telenor Linx AS in
\u00a0
2022.
3)
The company was presented as Telenor Tower Holding
\u00a0
AS earlier.
4)
The company is
\u00a0
newly established
\u00a0
in 2022.
5)
The company is
\u00a0
merged with Telenor
\u00a0
Communication
\u00a0
II AS in 2022.
6)
The company is sold from Telenor Mobile Communications
\u00a0
AS to Telenor Communication II AS in 2022.
Other significant
\u00a0
subsidiaries
\u00a0
(owned through
\u00a0
holding companies)
Office
Denmark
Telenor
\u00a0
Pakistan
\u00a0
(Private)
\u00a0
Ltd.
Pakistan
Total Access Communications Plc. (dtac)
Thailand
Bangladesh
Unitech Wireless Private Limited
\u00a0
India
DNA Plc
Finland
Telenor consolidated Digi before it was merged with Celcom in November 2022
\u00a0
and reported as an associate. Digi was listed on Bursa Malaysia
Securities Berhad and the shares in Digi were widely dispersed. Telenor owned 49%
\u00a0
of the shares, and 98% of the shares had to be present at
the General Meeting for Telenor not to have the majority of the votes. As a
\u00a0
consequence of this and based on experience from past General
Meetings, Telenor had the power to direct Digi\u2019s activities. The assessment
\u00a0
was that the ability to exercise control was upheld through a
majority of the votes at the General Meeting and at the Board of Directors
\u00a0
meetings. The consolidation of Digi based on de facto control was
assessed on an ongoing basis.
.
NOTE 34
Consolidation and group companies
\u00a0
Accounting policies
The consolidated financial statements include the financial
\u00a0
statements of Telenor ASA and entities controlled
\u00a0
by Telenor ASA. Control normally
exists when
\u00a0
the Group
\u00a0
has more
\u00a0
than 50%
\u00a0
of the voting
\u00a0
power through
\u00a0
ownership
\u00a0
or agreements,
\u00a0
except where
\u00a0
non-controlling
\u00a0
interests prevent
the exercise of control. Subsidiaries have the
\u00a0
same reporting periods as the parent company
\u00a0
and use consistent accounting policies. Intercompany
transactions, balances, revenues, expenses and unrealised
\u00a0
internal profit or losses are eliminated on consolidation. Non-controlling
\u00a0
interests in
subsidiaries are presented within equity separately from the equity attributable
\u00a0
to the owners of the parent, refer
\u00a0
to note 28. Non-controlling
interests
\u00a0
have been
\u00a0
measured
\u00a0
at the proportionate
\u00a0
fair value
\u00a0
of net identifiable
\u00a0
assets at
\u00a0
the date
\u00a0
of the business
\u00a0
combination
\u00a0
and share
\u00a0
of
changes in
\u00a0
equity since
\u00a0
the date
\u00a0
of the business
\u00a0
combination.
Shares in subsidiaries
Office
in % 2022
in % 2021
Telenor Networks Holding AS
Norway
100.0
100.0
Telenor Global Shared Services AS
\u00a0
Norway
100.0
100.0
Telenor
\u00a0
Communication
\u00a0
II AS
Norway
100.0
100.0
Telenor Mobile Holding AS
\u00a0
Norway
100.0
100.0
Norway
100.0
100.0
Telenor Forsikring AS
Norway
100.0
100.0
Telenor Maritime AS 1)
Norway
98.9
98.9
Norway
100.0
100.0
Cinclus Technology AS
\u00a0
Norway
100.0
100.0
Telenor Digital AS 2)
Norway
0.0
100.0
Telenor Real Estate AS
Norway
100.0
100.0
1)
The remaining
\u00a0
1.1% of shares
\u00a0
in Telenor Maritime
\u00a0
AS are owned by
\u00a0
Telenor Communication
\u00a0
II AS.
2)
Telenor Digital
\u00a0
AS is merged
\u00a0
with Telenor
\u00a0
Linx AS which
\u00a0
is owned by Telenor
\u00a0
Networks Holding
\u00a0
AS in 2022.
Shares in subsidiaries
\u00a0
owned through
\u00a0
subsidiaries
Office
in % 2022
in % 2021
Telenor Networks Holding AS
Norway
100.0
100.0
Telenor Linx AS
Norway
100.0
100.0
Telenor
\u00a0
Svalbard
\u00a0
AS
Norway
100.0
100.0
Norway
100.0
100.0
Telenor Nordic Towers AS
Norway
100.0
100.0
Telenor Satellite AS
Norway
100.0
100.0
Norway
100.0
Telenor Communication II AS
Telenor Financial Services AS
5)
Norway
0.0
100.0
Singapore
100.0
100.0
SnT East
\u00a0
Holding
\u00a0
AS
Norway
100.0
100.0
Telenor
\u00a0
India Private
\u00a0
Ltd
India
100.0
100.0
Norkring Belgi\u00eb N.V.
Belgium
75.0
75.0
Norway
100.0
100.0
Telenor
\u00a0
Marketplace
\u00a0
Invest AS
Norway
100.0
100.0
Telenor South Asia Investment Pte Ltd
6)
Singapore
100.0
0.0
Telenor Mobile Holding AS
Telenor
\u00a0
Mobile Communications
\u00a0
AS
Norway
100.0
100.0
Telenor Danmark Holding A/S
Denmark
100.0
100.0
Sweden
100.0
100.0
Telenor Connexion AB
\u00a0
Sweden
100.0
100.0
Canal Digital
\u00a0
Finland Oy
Finland
100.0
100.0
Telenor Finland Holding Oy
Finland
100.0
100.0
Telenor Maritime AS
Telenor
\u00a0
Maritime
\u00a0
Inc
USA
100.0
100.0
Telenor
\u00a0
Maritime
\u00a0
AB
Sweden
100.0
100.0
Telenor
\u00a0
Maritime
\u00a0
Pte
Singapore
100.0
100.0
Telenor
\u00a0
Maritime
\u00a0
Oy
Finland
100.0
100.0
Telenor Real Estate AS
Telenor Eiendom Harelokken AS
Norway
100.0
100.0
Norway
100.0
100.0
Telenor
\u00a0
M\u00f8re og Romsdal
\u00a0
og Tr\u00f8ndelag
\u00a0
2 AS
Norway
100.0
100.0
Telenor Vestlandet og Rogaland 2 AS
Norway
100.0
100.0
Telenor Agder Vestfold og Telemark 2 AS
Norway
100.0
100.0
Telenor Viken og Innlandet 2 AS
Norway
100.0
100.0
Telenor
\u00a0
\u00d8vre Strandgate
\u00a0
5 2 AS
Norway
100.0
100.0
Telenor L\u00e5veveien 55 AS
Norway
100.0
100.0
Telenor Jel\u00f8y Radio AS
Norway
100.0
100.0
Telenor Tryvann Radio AS
Norway
100.0
100.0
Telenor Festekontrakter AS
Norway
100.0
100.0
Telenor Linx AS
2)
Norway
100.0
100.0
1)
The company was presented as Telenor Global Services
\u00a0
AS earlier.
2)
Telenor Digital AS is merged with Telenor Linx AS in
\u00a0
2022.
3)
The company was presented as Telenor Tower Holding
\u00a0
AS earlier.
4)
The company is
\u00a0
newly established
\u00a0
in 2022.
5)
The company is
\u00a0
merged with Telenor
\u00a0
Communication
\u00a0
II AS in 2022.
6)
The company is sold from Telenor Mobile Communications
\u00a0
AS to Telenor Communication II AS in 2022.
Other significant
\u00a0
subsidiaries
\u00a0
(owned through
\u00a0
holding companies)
Office
Denmark
Telenor
\u00a0
Pakistan
\u00a0
(Private)
\u00a0
Ltd.
Pakistan
Total Access Communications Plc. (dtac)
Thailand
Bangladesh
Unitech Wireless Private Limited
\u00a0
India
DNA Plc
Finland
Telenor consolidated Digi before it was merged with Celcom in November 2022
\u00a0
and reported as an associate. Digi was listed on Bursa Malaysia
Securities Berhad and the shares in Digi were widely dispersed. Telenor owned 49%
\u00a0
of the shares, and 98% of the shares had to be present at
the General Meeting for Telenor not to have the majority of the votes. As a
\u00a0
consequence of this and based on experience from past General
Meetings, Telenor had the power to direct Digi\u2019s activities. The assessment
\u00a0
was that the ability to exercise control was upheld through a
majority of the votes at the General Meeting and at the Board of Directors
\u00a0
meetings. The consolidation of Digi based on de facto control was
assessed on an ongoing basis.
.
NOTE 35
Associated companies and joint arrangements
Associated companies are normally those entities where Telenor
\u00a0
has between 20 to 50 percent ownership. Joint
arrangements are those entities where Telenor shares control with
\u00a0
other parties. On 30 November 2022, the
subsidiary Digi in Malaysia merged with Celcom. This resulted
\u00a0
in a derecognition as a subsidiary of Telenor with a
gain of NOK 32.9 billion. After the merger, CelcomDigi is an associated
\u00a0
company with Telenor having an ownership
percentage of 33.1%.
Accounting policies
\u00a0
Associates
\u00a0
are those
\u00a0
entities
\u00a0
where Telenor
\u00a0
has significant
\u00a0
influence,
\u00a0
but not control
\u00a0
or joint control,
\u00a0
usually
\u00a0
between
\u00a0
20 to 50 percent
\u00a0
voting
power. Joint
\u00a0
ventures are
\u00a0
those entities
\u00a0
where unanimous
\u00a0
consent
\u00a0
is required
\u00a0
by the owners
\u00a0
on important
\u00a0
decision
\u00a0
and where
\u00a0
the parties
\u00a0
have
rights to net assets. Interests in joint
\u00a0
ventures and associates are accounted for using
\u00a0
the equity method. The investments are initially
\u00a0
recognised
at cost (including transaction costs) and subsequently
\u00a0
adjusted for the share of profits and
\u00a0
losses, dividends received and impairment. The profit
and losses
\u00a0
are presented
\u00a0
on a separate
\u00a0
line in the
\u00a0
income statement.
An investment
\u00a0
is a joint
\u00a0
operation
\u00a0
when unanimous
\u00a0
consent is
\u00a0
required
\u00a0
by the owners
\u00a0
on important
\u00a0
decisions
\u00a0
and Telenor
\u00a0
and the parties
\u00a0
have
rights to
\u00a0
specific
\u00a0
assets and
\u00a0
obligations.
\u00a0
These entities
\u00a0
are consolidated
\u00a0
on a line-by-line
\u00a0
basis with
\u00a0
a share of
\u00a0
revenues and
\u00a0
costs, and
\u00a0
the specific
assets and
\u00a0
liabilities
\u00a0
or the proportionate
\u00a0
share of
\u00a0
jointly
\u00a0
owned assets
\u00a0
and liabilities.
For investments
\u00a0
where financial
\u00a0
statements
\u00a0
are not
\u00a0
available
\u00a0
at the time
\u00a0
Telenor publishes
\u00a0
its report,
\u00a0
the share
\u00a0
of net income
\u00a0
is recognised
\u00a0
with a
one quarter
\u00a0
lag. Adjustments
\u00a0
are made
\u00a0
for significant
\u00a0
transactions
\u00a0
or events
\u00a0
known in
\u00a0
the market.
\u00a0
To ensure
\u00a0
consistency,
\u00a0
the Annual
\u00a0
Report is
\u00a0
not
updated in situations where the financial statements
\u00a0
for the investee are made available after fourth
\u00a0
quarter and before the issuance of the
\u00a0
Annual
Report, unless
\u00a0
the transactions
\u00a0
or events
\u00a0
are significant.
Associated companies
\u00a0
and joint ventures
NOK in millions
2022
2021
Balance as of 1 January
5 683
6 417
Additions
35 089
393
Disposals
1)
(432)
3
Share of
\u00a0
net income
\u00a0
(losses)
2)
(232)
(480)
Share of
\u00a0
other comprehensive
\u00a0
income
46
79
Dividends received
(575)
(532)
Translation differences
106
(198)
Balance as of 31 December
39 686
5 683
Of which
\u00a0
investment
\u00a0
in CelcomDigi
34 436
-
Of which investment in Telenor Microfinance Bank
\u00a0
Limited
5)
828
952
Of which investment in Carousell
6)
2 660
2 619
Of which
\u00a0
investment
\u00a0
in Allente
1 369
1 420
Of which
\u00a0
investment
\u00a0
in others
393
692
1)
Mainly relates to the disposal of Wave Money during
\u00a0
2022.
2)
Share of net income (loss) includes the Group\u2019s share
\u00a0
of net income (loss) after taxes, amortisation of excess
\u00a0
values, impairments, and adjustment for
differences in accounting policies.
\u00a0
3)
Of which NOK 0.3 billion from Allente and NOK 0.3
\u00a0
billion from CelcomDigi in 2022, and NOK 0.5 billion
\u00a0
from Allente in 2021.
\u00a0
4)
Of which NOK 34.1 billion relates to the market
\u00a0
value of the investment retained on disposal of
\u00a0
Digi.
5)
Of which allocated to goodwill NOK 0.8 billion in
\u00a0
2022 and NOK 0.9 billion in 2021.
6)
Of which allocated to goodwill NOK 2.7 billion in 2022
\u00a0
and NOK 2.1 billion in 2021.
As announced in June 2021, Telenor and Axiata
\u00a0
Group Berhad entered into an agreement to
\u00a0
merge Digi.Com Berhad and Celcom Axiata Berhad
\u00a0
in
Malaysia.
\u00a0
The merger
\u00a0
of the telecommunication
\u00a0
operations
\u00a0
of Celcom
\u00a0
and Digi
\u00a0
in Malaysia
\u00a0
was completed
\u00a0
on 30 November
\u00a0
2022. On
\u00a0
completion,
Digi issued 3.96 billion shares to Celcom\u2019s owner
\u00a0
Axiata in addition to making cash payments
\u00a0
of NOK 5.4 billion. The share issue
\u00a0
diluted Telenor\u2019s
ownership to 32.5%, Telenor lost control
\u00a0
over Digi, and Digi was deconsolidated and
\u00a0
recognised as an associated company as of 30
\u00a0
November
2022. As part of the transaction to
\u00a0
bring Telenor and Axiata to equal ownership, Telenor acquired
\u00a0
at the same date 73.4 million shares
\u00a0
from Axiata
for an amount of NOK 667 million. Telenor\u2019s
\u00a0
ownership after the transaction in CelcomDigi is 33.1%. The
\u00a0
gain of NOK 32.9 billion was recognised
\u00a0
on
the date
\u00a0
of losing
\u00a0
control over
\u00a0
Digi based
\u00a0
on a market
\u00a0
value of
\u00a0
the combined
\u00a0
entity as
\u00a0
of first
\u00a0
day of trading
\u00a0
i.e., 1 December
\u00a0
2022, which
\u00a0
was NOK
34.1 billion
\u00a0
for Telenor\u2019s
\u00a0
interest in
\u00a0
the new company
\u00a0
CelcomDigi.
\u00a0
See note 12
\u00a0
for more
\u00a0
information.
During 2022, Telenor injected NOK 0.2 billion
\u00a0
representing its proportionate share of the capital
\u00a0
into Telenor Microfinance Bank Limited (TMB).
Share of
\u00a0
net loss for
\u00a0
2022 includes
\u00a0
share of
\u00a0
losses related
\u00a0
to TMB of
\u00a0
NOK 0.2
\u00a0
billion (NOK
\u00a0
0.3 billion
\u00a0
in 2021).
As announced on 17 January 2022, Telenor
\u00a0
entered into an agreement with Yoma Strategic
\u00a0
to sell the Group's 51%
\u00a0
ownership share in Digital
Money Myanmar Limited (Wave Money) to Yoma MFS
\u00a0
Holdings Pte. Ltd, a subsidiary of Yoma Strategic.
\u00a0
The transaction was closed on 7 December
2022 for
\u00a0
a cash consideration
\u00a0
of NOK 0.4
\u00a0
billion.
\u00a0
The loss recognised
\u00a0
on disposal
\u00a0
was NOK 35
\u00a0
million during
\u00a0
2022.
In 2022,
\u00a0
Telenor\u2019s
\u00a0
economic
\u00a0
interest
\u00a0
in Carousell
\u00a0
was diluted
\u00a0
following
\u00a0
new capital
\u00a0
investment
\u00a0
of USD 15
\u00a0
million.
\u00a0
The loss of
\u00a0
NOK 36 million
\u00a0
was
recognised during 2022 on deemed
\u00a0
disposal.
\u00a0
As of 31 December 2022, Telenor\u2019s economic
\u00a0
interest in Carousell stands at 32.4%.
\u00a0
During 2021, new
capital
\u00a0
of USD 100
\u00a0
million was
\u00a0
raised by
\u00a0
Carousell
\u00a0
leading
\u00a0
to the dilution
\u00a0
of Telenor\u2019s
\u00a0
economic
\u00a0
interest
\u00a0
in Carousell
\u00a0
from 37.4%
\u00a0
to 33.6%
\u00a0
as of 31
December 2021. The gain of NOK 21 million
\u00a0
was recognised during 2021.
Significant associates
\u00a0
and joint ventures
CelcomDigi is an associated company where Telenor controls
\u00a0
33.1% of the shares and voting rights.
\u00a0
The associate is accounted for using the
\u00a0
equity
method. CelcomDigi is a telecommunication company, listed
\u00a0
on Bursa Malaysia Berhad and became the
\u00a0
largest mobile network operator
\u00a0
in
Malaysia through a merger between the former Telenor
\u00a0
subsidiary Digi and Celcom Axiata Berhad in November 2022.
\u00a0
Telenor share of
CelcomDigi\u2019s
\u00a0
market value
\u00a0
amounted
\u00a0
to NOK 34.7
\u00a0
billion as
\u00a0
of 31 December
\u00a0
2022.
The Group
\u00a0
is not aware
\u00a0
of significant
\u00a0
restrictions
\u00a0
limiting
\u00a0
the ability
\u00a0
of CelcomDigi
\u00a0
to transfer
\u00a0
funds to
\u00a0
its shareholders.
\u00a0
For example,
\u00a0
under the
form of dividends,
\u00a0
repayment
\u00a0
of advances
\u00a0
or loans
\u00a0
made.
As the financial
\u00a0
quarterly
\u00a0
results of
\u00a0
the listed
\u00a0
company CelcomDigi
\u00a0
will not
\u00a0
always be
\u00a0
published
\u00a0
at the time
\u00a0
Telenor reports
\u00a0
its quarterly
\u00a0
results,
Telenor will
\u00a0
include the
\u00a0
share of
\u00a0
profits from
\u00a0
CelcomDigi
\u00a0
with a one-quarter
\u00a0
lag. This
\u00a0
means that
\u00a0
the fourth
\u00a0
quarter results
\u00a0
of CelcomDigi
\u00a0
consisting
of December
\u00a0
2022 will
\u00a0
be included
\u00a0
in the Telenor\u2019s
\u00a0
Q1 2023
\u00a0
report.
The following table sets forth the summarised
\u00a0
financial information of CelcomDigi. The figures reflect the
\u00a0
opening balance for CelcomDigi on 1
December 2022, adjusted for dividend received by Telenor
\u00a0
in December 2022. The financial information includes
\u00a0
the preliminary allocation of the
excess values recognised as part of the merger, and
\u00a0
reconciliation with the carrying amount of the investment
\u00a0
for the Group.
NOK in millions
2022
Statement of financial position
77 836
Current assets excluding cash and cash equivalents
9 593
Cash and
\u00a0
cash equivalents
7 744
Non-current non-interest-bearing
\u00a0
liabilities
(6 978)
Non-current interest-bearing liabilities
(33 310)
Current non-interest-bearing
\u00a0
liabilities
(8 194)
Total equity
46 691
Group's share of equity
\u00a0
15 455
Goodwill
\u00a0
related to
\u00a0
the Group's
\u00a0
investment
18 981
Carrying
\u00a0
amount of
\u00a0
investment
34 436
Dividends received
289
Allente
Allente
\u00a0
Group AB
\u00a0
(Allente)
\u00a0
is a joint
\u00a0
venture where
\u00a0
Telenor
\u00a0
controls
\u00a0
50% of the
\u00a0
shares and
\u00a0
the voting
\u00a0
rights. The
\u00a0
joint venture
\u00a0
is accounted
\u00a0
for using
the equity method. Allente is a Nordic TV
\u00a0
distributor broadcasting via satellite and internet TV,
\u00a0
to customers within Norway, Sweden, Denmark, and
Finland. Allente was established in May 2020 through
\u00a0
a merger between the former Telenor subsidiary Canal
\u00a0
Digital and Nordic Entertainment
The following
\u00a0
table sets
\u00a0
forth summarised
\u00a0
financial
\u00a0
information
\u00a0
of Allente,
\u00a0
including
\u00a0
excess values
\u00a0
from the
\u00a0
merger in
\u00a0
2020, and
\u00a0
reconciliation
\u00a0
with
the carrying
\u00a0
amount of
\u00a0
the investment
\u00a0
for the Group:
NOK in millions
2022
2021
Statement of comprehensive income
Revenue
6 472
6 826
EBITDA
1 181
593
Depreciation
\u00a0
and amortisation
(526)
(663)
(62)
-
(143)
46
Net income
470
(25)
Other comprehensive
\u00a0
income(loss)
83
148
Total comprehensive
\u00a0
income (loss)
553
123
Group's ownership
\u00a0
in %
50
50
Group's share of net income (loss) from continuing operations
235
(12)
Group's share of other comprehensive income (loss)
42
74
Group's share of total comprehensive income (loss)
277
61
NOK in millions
2022
2021
Statement of financial position
4 401
4 910
Current assets excluding cash and cash equivalents
1 781
1 647
Cash and
\u00a0
cash equivalents
144
191
Non-current non-interest-bearing
\u00a0
liabilities
(442)
(514)
Non-current interest-bearing liabilities
(1 948)
(2 252)
Current non-interest-bearing
\u00a0
liabilities
(1 971)
(1 940)
Total equity
1 964
2 042
Group's share of equity
\u00a0
982
1 021
Goodwill
\u00a0
related to
\u00a0
the Group's
\u00a0
investment
387
399
Carrying
\u00a0
amount of
\u00a0
investment
1 369
1 420
Dividends received
285
501
.
Joint operations
The Group is part of four joint
\u00a0
arrangements for networks sharing in Sweden, Denmark,
\u00a0
and Finland. These joint arrangements are structured
through separate
\u00a0
vehicles.
\u00a0
The activities
\u00a0
are designed
\u00a0
for the provision
\u00a0
of output
\u00a0
to the investors
\u00a0
and hence
\u00a0
these arrangements
\u00a0
are classified
\u00a0
as
joint operations.
Joint Operation
Description
Ownership
\u00a0
interest in
\u00a0
%
3G Infrastructure
\u00a0
Services
AB
Joint operation with the mobile operator 3
\u00a0
in Sweden
1)
50
Net4Mobility HB
Joint operation under partnership agreement with the
\u00a0
mobile operator Tele2 Sverige AB in
Sweden
1)
50
TT Netv\u00e6rket P/S
Joint operation
\u00a0
with the
\u00a0
mobile operator
\u00a0
TeliaSonera
\u00a0
Mobile Holding
\u00a0
AB in Denmark
50
Suomen Yhteisverkko
\u00a0
Oy
Joint operations with mobile Operator Telia Finland Oy
\u00a0
in Finland
2)
49
.
1)
Under Swedish law, all partners in a partnership are
\u00a0
jointly and severally liable for all obligations in a partnership.
2)
According to the shareholder\u2019s agreement, both partners
\u00a0
in are jointly and severally liable for all obligations
\u00a0
in the joint undertaking.
NOTE 35
Associated companies and joint arrangements
Associated companies are normally those entities where Telenor
\u00a0
has between 20 to 50 percent ownership. Joint
arrangements are those entities where Telenor shares control with
\u00a0
other parties. On 30 November 2022, the
subsidiary Digi in Malaysia merged with Celcom. This resulted
\u00a0
in a derecognition as a subsidiary of Telenor with a
gain of NOK 32.9 billion. After the merger, CelcomDigi is an associated
\u00a0
company with Telenor having an ownership
percentage of 33.1%.
Accounting policies
\u00a0
Associates
\u00a0
are those
\u00a0
entities
\u00a0
where Telenor
\u00a0
has significant
\u00a0
influence,
\u00a0
but not control
\u00a0
or joint control,
\u00a0
usually
\u00a0
between
\u00a0
20 to 50 percent
\u00a0
voting
power. Joint
\u00a0
ventures are
\u00a0
those entities
\u00a0
where unanimous
\u00a0
consent
\u00a0
is required
\u00a0
by the owners
\u00a0
on important
\u00a0
decision
\u00a0
and where
\u00a0
the parties
\u00a0
have
rights to net assets. Interests in joint
\u00a0
ventures and associates are accounted for using
\u00a0
the equity method. The investments are initially
\u00a0
recognised
at cost (including transaction costs) and subsequently
\u00a0
adjusted for the share of profits and
\u00a0
losses, dividends received and impairment. The profit
and losses
\u00a0
are presented
\u00a0
on a separate
\u00a0
line in the
\u00a0
income statement.
An investment
\u00a0
is a joint
\u00a0
operation
\u00a0
when unanimous
\u00a0
consent is
\u00a0
required
\u00a0
by the owners
\u00a0
on important
\u00a0
decisions
\u00a0
and Telenor
\u00a0
and the parties
\u00a0
have
rights to
\u00a0
specific
\u00a0
assets and
\u00a0
obligations.
\u00a0
These entities
\u00a0
are consolidated
\u00a0
on a line-by-line
\u00a0
basis with
\u00a0
a share of
\u00a0
revenues and
\u00a0
costs, and
\u00a0
the specific
assets and
\u00a0
liabilities
\u00a0
or the proportionate
\u00a0
share of
\u00a0
jointly
\u00a0
owned assets
\u00a0
and liabilities.
For investments
\u00a0
where financial
\u00a0
statements
\u00a0
are not
\u00a0
available
\u00a0
at the time
\u00a0
Telenor publishes
\u00a0
its report,
\u00a0
the share
\u00a0
of net income
\u00a0
is recognised
\u00a0
with a
one quarter
\u00a0
lag. Adjustments
\u00a0
are made
\u00a0
for significant
\u00a0
transactions
\u00a0
or events
\u00a0
known in
\u00a0
the market.
\u00a0
To ensure
\u00a0
consistency,
\u00a0
the Annual
\u00a0
Report is
\u00a0
not
updated in situations where the financial statements
\u00a0
for the investee are made available after fourth
\u00a0
quarter and before the issuance of the
\u00a0
Annual
Report, unless
\u00a0
the transactions
\u00a0
or events
\u00a0
are significant.
Associated companies
\u00a0
and joint ventures
NOK in millions
2022
2021
Balance as of 1 January
5 683
6 417
Additions
35 089
393
Disposals
1)
(432)
3
Share of
\u00a0
net income
\u00a0
(losses)
2)
(232)
(480)
Share of
\u00a0
other comprehensive
\u00a0
income
46
79
Dividends received
(575)
(532)
Translation differences
106
(198)
Balance as of 31 December
39 686
5 683
Of which
\u00a0
investment
\u00a0
in CelcomDigi
34 436
-
Of which investment in Telenor Microfinance Bank
\u00a0
Limited
5)
828
952
Of which investment in Carousell
6)
2 660
2 619
Of which
\u00a0
investment
\u00a0
in Allente
1 369
1 420
Of which
\u00a0
investment
\u00a0
in others
393
692
1)
Mainly relates to the disposal of Wave Money during
\u00a0
2022.
2)
Share of net income (loss) includes the Group\u2019s share
\u00a0
of net income (loss) after taxes, amortisation of excess
\u00a0
values, impairments, and adjustment for
differences in accounting policies.
\u00a0
3)
Of which NOK 0.3 billion from Allente and NOK 0.3
\u00a0
billion from CelcomDigi in 2022, and NOK 0.5 billion
\u00a0
from Allente in 2021.
\u00a0
4)
Of which NOK 34.1 billion relates to the market
\u00a0
value of the investment retained on disposal of
\u00a0
Digi.
5)
Of which allocated to goodwill NOK 0.8 billion in
\u00a0
2022 and NOK 0.9 billion in 2021.
6)
Of which allocated to goodwill NOK 2.7 billion in 2022
\u00a0
and NOK 2.1 billion in 2021.
As announced in June 2021, Telenor and Axiata
\u00a0
Group Berhad entered into an agreement to
\u00a0
merge Digi.Com Berhad and Celcom Axiata Berhad
\u00a0
in
Malaysia.
\u00a0
The merger
\u00a0
of the telecommunication
\u00a0
operations
\u00a0
of Celcom
\u00a0
and Digi
\u00a0
in Malaysia
\u00a0
was completed
\u00a0
on 30 November
\u00a0
2022. On
\u00a0
completion,
Digi issued 3.96 billion shares to Celcom\u2019s owner
\u00a0
Axiata in addition to making cash payments
\u00a0
of NOK 5.4 billion. The share issue
\u00a0
diluted Telenor\u2019s
ownership to 32.5%, Telenor lost control
\u00a0
over Digi, and Digi was deconsolidated and
\u00a0
recognised as an associated company as of 30
\u00a0
November
2022. As part of the transaction to
\u00a0
bring Telenor and Axiata to equal ownership, Telenor acquired
\u00a0
at the same date 73.4 million shares
\u00a0
from Axiata
for an amount of NOK 667 million. Telenor\u2019s
\u00a0
ownership after the transaction in CelcomDigi is 33.1%. The
\u00a0
gain of NOK 32.9 billion was recognised
\u00a0
on
the date
\u00a0
of losing
\u00a0
control over
\u00a0
Digi based
\u00a0
on a market
\u00a0
value of
\u00a0
the combined
\u00a0
entity as
\u00a0
of first
\u00a0
day of trading
\u00a0
i.e., 1 December
\u00a0
2022, which
\u00a0
was NOK
34.1 billion
\u00a0
for Telenor\u2019s
\u00a0
interest in
\u00a0
the new company
\u00a0
CelcomDigi.
\u00a0
See note 12
\u00a0
for more
\u00a0
information.
During 2022, Telenor injected NOK 0.2 billion
\u00a0
representing its proportionate share of the capital
\u00a0
into Telenor Microfinance Bank Limited (TMB).
Share of
\u00a0
net loss for
\u00a0
2022 includes
\u00a0
share of
\u00a0
losses related
\u00a0
to TMB of
\u00a0
NOK 0.2
\u00a0
billion (NOK
\u00a0
0.3 billion
\u00a0
in 2021).
As announced on 17 January 2022, Telenor
\u00a0
entered into an agreement with Yoma Strategic
\u00a0
to sell the Group's 51%
\u00a0
ownership share in Digital
Money Myanmar Limited (Wave Money) to Yoma MFS
\u00a0
Holdings Pte. Ltd, a subsidiary of Yoma Strategic.
\u00a0
The transaction was closed on 7 December
2022 for
\u00a0
a cash consideration
\u00a0
of NOK 0.4
\u00a0
billion.
\u00a0
The loss recognised
\u00a0
on disposal
\u00a0
was NOK 35
\u00a0
million during
\u00a0
2022.
In 2022,
\u00a0
Telenor\u2019s
\u00a0
economic
\u00a0
interest
\u00a0
in Carousell
\u00a0
was diluted
\u00a0
following
\u00a0
new capital
\u00a0
investment
\u00a0
of USD 15
\u00a0
million.
\u00a0
The loss of
\u00a0
NOK 36 million
\u00a0
was
recognised during 2022 on deemed
\u00a0
disposal.
\u00a0
As of 31 December 2022, Telenor\u2019s economic
\u00a0
interest in Carousell stands at 32.4%.
\u00a0
During 2021, new
capital
\u00a0
of USD 100
\u00a0
million was
\u00a0
raised by
\u00a0
Carousell
\u00a0
leading
\u00a0
to the dilution
\u00a0
of Telenor\u2019s
\u00a0
economic
\u00a0
interest
\u00a0
in Carousell
\u00a0
from 37.4%
\u00a0
to 33.6%
\u00a0
as of 31
December 2021. The gain of NOK 21 million
\u00a0
was recognised during 2021.
Significant associates
\u00a0
and joint ventures
CelcomDigi is an associated company where Telenor controls
\u00a0
33.1% of the shares and voting rights.
\u00a0
The associate is accounted for using the
\u00a0
equity
method. CelcomDigi is a telecommunication company, listed
\u00a0
on Bursa Malaysia Berhad and became the
\u00a0
largest mobile network operator
\u00a0
in
Malaysia through a merger between the former Telenor
\u00a0
subsidiary Digi and Celcom Axiata Berhad in November 2022.
\u00a0
Telenor share of
CelcomDigi\u2019s
\u00a0
market value
\u00a0
amounted
\u00a0
to NOK 34.7
\u00a0
billion as
\u00a0
of 31 December
\u00a0
2022.
The Group
\u00a0
is not aware
\u00a0
of significant
\u00a0
restrictions
\u00a0
limiting
\u00a0
the ability
\u00a0
of CelcomDigi
\u00a0
to transfer
\u00a0
funds to
\u00a0
its shareholders.
\u00a0
For example,
\u00a0
under the
form of dividends,
\u00a0
repayment
\u00a0
of advances
\u00a0
or loans
\u00a0
made.
As the financial
\u00a0
quarterly
\u00a0
results of
\u00a0
the listed
\u00a0
company CelcomDigi
\u00a0
will not
\u00a0
always be
\u00a0
published
\u00a0
at the time
\u00a0
Telenor reports
\u00a0
its quarterly
\u00a0
results,
Telenor will
\u00a0
include the
\u00a0
share of
\u00a0
profits from
\u00a0
CelcomDigi
\u00a0
with a one-quarter
\u00a0
lag. This
\u00a0
means that
\u00a0
the fourth
\u00a0
quarter results
\u00a0
of CelcomDigi
\u00a0
consisting
of December
\u00a0
2022 will
\u00a0
be included
\u00a0
in the Telenor\u2019s
\u00a0
Q1 2023
\u00a0
report.
The following table sets forth the summarised
\u00a0
financial information of CelcomDigi. The figures reflect the
\u00a0
opening balance for CelcomDigi on 1
December 2022, adjusted for dividend received by Telenor
\u00a0
in December 2022. The financial information includes
\u00a0
the preliminary allocation of the
excess values recognised as part of the merger, and
\u00a0
reconciliation with the carrying amount of the investment
\u00a0
for the Group.
NOK in millions
2022
Statement of financial position
77 836
Current assets excluding cash and cash equivalents
9 593
Cash and
\u00a0
cash equivalents
7 744
Non-current non-interest-bearing
\u00a0
liabilities
(6 978)
Non-current interest-bearing liabilities
(33 310)
Current non-interest-bearing
\u00a0
liabilities
(8 194)
Total equity
46 691
Group's share of equity
\u00a0
15 455
Goodwill
\u00a0
related to
\u00a0
the Group's
\u00a0
investment
18 981
Carrying
\u00a0
amount of
\u00a0
investment
34 436
Dividends received
289
Allente
Allente
\u00a0
Group AB
\u00a0
(Allente)
\u00a0
is a joint
\u00a0
venture where
\u00a0
Telenor
\u00a0
controls
\u00a0
50% of the
\u00a0
shares and
\u00a0
the voting
\u00a0
rights. The
\u00a0
joint venture
\u00a0
is accounted
\u00a0
for using
the equity method. Allente is a Nordic TV
\u00a0
distributor broadcasting via satellite and internet TV,
\u00a0
to customers within Norway, Sweden, Denmark, and
Finland. Allente was established in May 2020 through
\u00a0
a merger between the former Telenor subsidiary Canal
\u00a0
Digital and Nordic Entertainment
The following
\u00a0
table sets
\u00a0
forth summarised
\u00a0
financial
\u00a0
information
\u00a0
of Allente,
\u00a0
including
\u00a0
excess values
\u00a0
from the
\u00a0
merger in
\u00a0
2020, and
\u00a0
reconciliation
\u00a0
with
the carrying
\u00a0
amount of
\u00a0
the investment
\u00a0
for the Group:
NOK in millions
2022
2021
Statement of comprehensive income
Revenue
6 472
6 826
EBITDA
1 181
593
Depreciation
\u00a0
and amortisation
(526)
(663)
(62)
-
(143)
46
Net income
470
(25)
Other comprehensive
\u00a0
income(loss)
83
148
Total comprehensive
\u00a0
income (loss)
553
123
Group's ownership
\u00a0
in %
50
50
Group's share of net income (loss) from continuing operations
235
(12)
Group's share of other comprehensive income (loss)
42
74
Group's share of total comprehensive income (loss)
277
61
NOK in millions
2022
2021
Statement of financial position
4 401
4 910
Current assets excluding cash and cash equivalents
1 781
1 647
Cash and
\u00a0
cash equivalents
144
191
Non-current non-interest-bearing
\u00a0
liabilities
(442)
(514)
Non-current interest-bearing liabilities
(1 948)
(2 252)
Current non-interest-bearing
\u00a0
liabilities
(1 971)
(1 940)
Total equity
1 964
2 042
Group's share of equity
\u00a0
982
1 021
Goodwill
\u00a0
related to
\u00a0
the Group's
\u00a0
investment
387
399
Carrying
\u00a0
amount of
\u00a0
investment
1 369
1 420
Dividends received
285
501
.
Joint operations
The Group is part of four joint
\u00a0
arrangements for networks sharing in Sweden, Denmark,
\u00a0
and Finland. These joint arrangements are structured
through separate
\u00a0
vehicles.
\u00a0
The activities
\u00a0
are designed
\u00a0
for the provision
\u00a0
of output
\u00a0
to the investors
\u00a0
and hence
\u00a0
these arrangements
\u00a0
are classified
\u00a0
as
joint operations.
Joint Operation
Description
Ownership
\u00a0
interest in
\u00a0
%
3G Infrastructure
\u00a0
Services
AB
Joint operation with the mobile operator 3
\u00a0
in Sweden
1)
50
Net4Mobility HB
Joint operation under partnership agreement with the
\u00a0
mobile operator Tele2 Sverige AB in
Sweden
1)
50
TT Netv\u00e6rket P/S
Joint operation
\u00a0
with the
\u00a0
mobile operator
\u00a0
TeliaSonera
\u00a0
Mobile Holding
\u00a0
AB in Denmark
50
Suomen Yhteisverkko
\u00a0
Oy
Joint operations with mobile Operator Telia Finland Oy
\u00a0
in Finland
2)
49
.
1)
Under Swedish law, all partners in a partnership are
\u00a0
jointly and severally liable for all obligations in a partnership.
2)
According to the shareholder\u2019s agreement, both partners
\u00a0
in are jointly and severally liable for all obligations
\u00a0
in the joint undertaking.
NOTE 35
Associated companies and joint arrangements
Associated companies are normally those entities where Telenor
\u00a0
has between 20 to 50 percent ownership. Joint
arrangements are those entities where Telenor shares control with
\u00a0
other parties. On 30 November 2022, the
subsidiary Digi in Malaysia merged with Celcom. This resulted
\u00a0
in a derecognition as a subsidiary of Telenor with a
gain of NOK 32.9 billion. After the merger, CelcomDigi is an associated
\u00a0
company with Telenor having an ownership
percentage of 33.1%.
Accounting policies
\u00a0
Associates
\u00a0
are those
\u00a0
entities
\u00a0
where Telenor
\u00a0
has significant
\u00a0
influence,
\u00a0
but not control
\u00a0
or joint control,
\u00a0
usually
\u00a0
between
\u00a0
20 to 50 percent
\u00a0
voting
power. Joint
\u00a0
ventures are
\u00a0
those entities
\u00a0
where unanimous
\u00a0
consent
\u00a0
is required
\u00a0
by the owners
\u00a0
on important
\u00a0
decision
\u00a0
and where
\u00a0
the parties
\u00a0
have
rights to net assets. Interests in joint
\u00a0
ventures and associates are accounted for using
\u00a0
the equity method. The investments are initially
\u00a0
recognised
at cost (including transaction costs) and subsequently
\u00a0
adjusted for the share of profits and
\u00a0
losses, dividends received and impairment. The profit
and losses
\u00a0
are presented
\u00a0
on a separate
\u00a0
line in the
\u00a0
income statement.
An investment
\u00a0
is a joint
\u00a0
operation
\u00a0
when unanimous
\u00a0
consent is
\u00a0
required
\u00a0
by the owners
\u00a0
on important
\u00a0
decisions
\u00a0
and Telenor
\u00a0
and the parties
\u00a0
have
rights to
\u00a0
specific
\u00a0
assets and
\u00a0
obligations.
\u00a0
These entities
\u00a0
are consolidated
\u00a0
on a line-by-line
\u00a0
basis with
\u00a0
a share of
\u00a0
revenues and
\u00a0
costs, and
\u00a0
the specific
assets and
\u00a0
liabilities
\u00a0
or the proportionate
\u00a0
share of
\u00a0
jointly
\u00a0
owned assets
\u00a0
and liabilities.
For investments
\u00a0
where financial
\u00a0
statements
\u00a0
are not
\u00a0
available
\u00a0
at the time
\u00a0
Telenor publishes
\u00a0
its report,
\u00a0
the share
\u00a0
of net income
\u00a0
is recognised
\u00a0
with a
one quarter
\u00a0
lag. Adjustments
\u00a0
are made
\u00a0
for significant
\u00a0
transactions
\u00a0
or events
\u00a0
known in
\u00a0
the market.
\u00a0
To ensure
\u00a0
consistency,
\u00a0
the Annual
\u00a0
Report is
\u00a0
not
updated in situations where the financial statements
\u00a0
for the investee are made available after fourth
\u00a0
quarter and before the issuance of the
\u00a0
Annual
Report, unless
\u00a0
the transactions
\u00a0
or events
\u00a0
are significant.
Associated companies
\u00a0
and joint ventures
NOK in millions
2022
2021
Balance as of 1 January
5 683
6 417
Additions
35 089
393
Disposals
1)
(432)
3
Share of
\u00a0
net income
\u00a0
(losses)
2)
(232)
(480)
Share of
\u00a0
other comprehensive
\u00a0
income
46
79
Dividends received
(575)
(532)
Translation differences
106
(198)
Balance as of 31 December
39 686
5 683
Of which
\u00a0
investment
\u00a0
in CelcomDigi
34 436
-
Of which investment in Telenor Microfinance Bank
\u00a0
Limited
5)
828
952
Of which investment in Carousell
6)
2 660
2 619
Of which
\u00a0
investment
\u00a0
in Allente
1 369
1 420
Of which
\u00a0
investment
\u00a0
in others
393
692
1)
Mainly relates to the disposal of Wave Money during
\u00a0
2022.
2)
Share of net income (loss) includes the Group\u2019s share
\u00a0
of net income (loss) after taxes, amortisation of excess
\u00a0
values, impairments, and adjustment for
differences in accounting policies.
\u00a0
3)
Of which NOK 0.3 billion from Allente and NOK 0.3
\u00a0
billion from CelcomDigi in 2022, and NOK 0.5 billion
\u00a0
from Allente in 2021.
\u00a0
4)
Of which NOK 34.1 billion relates to the market
\u00a0
value of the investment retained on disposal of
\u00a0
Digi.
5)
Of which allocated to goodwill NOK 0.8 billion in
\u00a0
2022 and NOK 0.9 billion in 2021.
6)
Of which allocated to goodwill NOK 2.7 billion in 2022
\u00a0
and NOK 2.1 billion in 2021.
As announced in June 2021, Telenor and Axiata
\u00a0
Group Berhad entered into an agreement to
\u00a0
merge Digi.Com Berhad and Celcom Axiata Berhad
\u00a0
in
Malaysia.
\u00a0
The merger
\u00a0
of the telecommunication
\u00a0
operations
\u00a0
of Celcom
\u00a0
and Digi
\u00a0
in Malaysia
\u00a0
was completed
\u00a0
on 30 November
\u00a0
2022. On
\u00a0
completion,
Digi issued 3.96 billion shares to Celcom\u2019s owner
\u00a0
Axiata in addition to making cash payments
\u00a0
of NOK 5.4 billion. The share issue
\u00a0
diluted Telenor\u2019s
ownership to 32.5%, Telenor lost control
\u00a0
over Digi, and Digi was deconsolidated and
\u00a0
recognised as an associated company as of 30
\u00a0
November
2022. As part of the transaction to
\u00a0
bring Telenor and Axiata to equal ownership, Telenor acquired
\u00a0
at the same date 73.4 million shares
\u00a0
from Axiata
for an amount of NOK 667 million. Telenor\u2019s
\u00a0
ownership after the transaction in CelcomDigi is 33.1%. The
\u00a0
gain of NOK 32.9 billion was recognised
\u00a0
on
the date
\u00a0
of losing
\u00a0
control over
\u00a0
Digi based
\u00a0
on a market
\u00a0
value of
\u00a0
the combined
\u00a0
entity as
\u00a0
of first
\u00a0
day of trading
\u00a0
i.e., 1 December
\u00a0
2022, which
\u00a0
was NOK
34.1 billion
\u00a0
for Telenor\u2019s
\u00a0
interest in
\u00a0
the new company
\u00a0
CelcomDigi.
\u00a0
See note 12
\u00a0
for more
\u00a0
information.
During 2022, Telenor injected NOK 0.2 billion
\u00a0
representing its proportionate share of the capital
\u00a0
into Telenor Microfinance Bank Limited (TMB).
Share of
\u00a0
net loss for
\u00a0
2022 includes
\u00a0
share of
\u00a0
losses related
\u00a0
to TMB of
\u00a0
NOK 0.2
\u00a0
billion (NOK
\u00a0
0.3 billion
\u00a0
in 2021).
As announced on 17 January 2022, Telenor
\u00a0
entered into an agreement with Yoma Strategic
\u00a0
to sell the Group's 51%
\u00a0
ownership share in Digital
Money Myanmar Limited (Wave Money) to Yoma MFS
\u00a0
Holdings Pte. Ltd, a subsidiary of Yoma Strategic.
\u00a0
The transaction was closed on 7 December
2022 for
\u00a0
a cash consideration
\u00a0
of NOK 0.4
\u00a0
billion.
\u00a0
The loss recognised
\u00a0
on disposal
\u00a0
was NOK 35
\u00a0
million during
\u00a0
2022.
In 2022,
\u00a0
Telenor\u2019s
\u00a0
economic
\u00a0
interest
\u00a0
in Carousell
\u00a0
was diluted
\u00a0
following
\u00a0
new capital
\u00a0
investment
\u00a0
of USD 15
\u00a0
million.
\u00a0
The loss of
\u00a0
NOK 36 million
\u00a0
was
recognised during 2022 on deemed
\u00a0
disposal.
\u00a0
As of 31 December 2022, Telenor\u2019s economic
\u00a0
interest in Carousell stands at 32.4%.
\u00a0
During 2021, new
capital
\u00a0
of USD 100
\u00a0
million was
\u00a0
raised by
\u00a0
Carousell
\u00a0
leading
\u00a0
to the dilution
\u00a0
of Telenor\u2019s
\u00a0
economic
\u00a0
interest
\u00a0
in Carousell
\u00a0
from 37.4%
\u00a0
to 33.6%
\u00a0
as of 31
December 2021. The gain of NOK 21 million
\u00a0
was recognised during 2021.
Significant associates
\u00a0
and joint ventures
CelcomDigi is an associated company where Telenor controls
\u00a0
33.1% of the shares and voting rights.
\u00a0
The associate is accounted for using the
\u00a0
equity
method. CelcomDigi is a telecommunication company, listed
\u00a0
on Bursa Malaysia Berhad and became the
\u00a0
largest mobile network operator
\u00a0
in
Malaysia through a merger between the former Telenor
\u00a0
subsidiary Digi and Celcom Axiata Berhad in November 2022.
\u00a0
Telenor share of
CelcomDigi\u2019s
\u00a0
market value
\u00a0
amounted
\u00a0
to NOK 34.7
\u00a0
billion as
\u00a0
of 31 December
\u00a0
2022.
The Group
\u00a0
is not aware
\u00a0
of significant
\u00a0
restrictions
\u00a0
limiting
\u00a0
the ability
\u00a0
of CelcomDigi
\u00a0
to transfer
\u00a0
funds to
\u00a0
its shareholders.
\u00a0
For example,
\u00a0
under the
form of dividends,
\u00a0
repayment
\u00a0
of advances
\u00a0
or loans
\u00a0
made.
As the financial
\u00a0
quarterly
\u00a0
results of
\u00a0
the listed
\u00a0
company CelcomDigi
\u00a0
will not
\u00a0
always be
\u00a0
published
\u00a0
at the time
\u00a0
Telenor reports
\u00a0
its quarterly
\u00a0
results,
Telenor will
\u00a0
include the
\u00a0
share of
\u00a0
profits from
\u00a0
CelcomDigi
\u00a0
with a one-quarter
\u00a0
lag. This
\u00a0
means that
\u00a0
the fourth
\u00a0
quarter results
\u00a0
of CelcomDigi
\u00a0
consisting
of December
\u00a0
2022 will
\u00a0
be included
\u00a0
in the Telenor\u2019s
\u00a0
Q1 2023
\u00a0
report.
The following table sets forth the summarised
\u00a0
financial information of CelcomDigi. The figures reflect the
\u00a0
opening balance for CelcomDigi on 1
December 2022, adjusted for dividend received by Telenor
\u00a0
in December 2022. The financial information includes
\u00a0
the preliminary allocation of the
excess values recognised as part of the merger, and
\u00a0
reconciliation with the carrying amount of the investment
\u00a0
for the Group.
NOK in millions
2022
Statement of financial position
77 836
Current assets excluding cash and cash equivalents
9 593
Cash and
\u00a0
cash equivalents
7 744
Non-current non-interest-bearing
\u00a0
liabilities
(6 978)
Non-current interest-bearing liabilities
(33 310)
Current non-interest-bearing
\u00a0
liabilities
(8 194)
Total equity
46 691
Group's share of equity
\u00a0
15 455
Goodwill
\u00a0
related to
\u00a0
the Group's
\u00a0
investment
18 981
Carrying
\u00a0
amount of
\u00a0
investment
34 436
Dividends received
289
Allente
Allente
\u00a0
Group AB
\u00a0
(Allente)
\u00a0
is a joint
\u00a0
venture where
\u00a0
Telenor
\u00a0
controls
\u00a0
50% of the
\u00a0
shares and
\u00a0
the voting
\u00a0
rights. The
\u00a0
joint venture
\u00a0
is accounted
\u00a0
for using
the equity method. Allente is a Nordic TV
\u00a0
distributor broadcasting via satellite and internet TV,
\u00a0
to customers within Norway, Sweden, Denmark, and
Finland. Allente was established in May 2020 through
\u00a0
a merger between the former Telenor subsidiary Canal
\u00a0
Digital and Nordic Entertainment
The following
\u00a0
table sets
\u00a0
forth summarised
\u00a0
financial
\u00a0
information
\u00a0
of Allente,
\u00a0
including
\u00a0
excess values
\u00a0
from the
\u00a0
merger in
\u00a0
2020, and
\u00a0
reconciliation
\u00a0
with
the carrying
\u00a0
amount of
\u00a0
the investment
\u00a0
for the Group:
NOK in millions
2022
2021
Statement of comprehensive income
Revenue
6 472
6 826
EBITDA
1 181
593
Depreciation
\u00a0
and amortisation
(526)
(663)
(62)
-
(143)
46
Net income
470
(25)
Other comprehensive
\u00a0
income(loss)
83
148
Total comprehensive
\u00a0
income (loss)
553
123
Group's ownership
\u00a0
in %
50
50
Group's share of net income (loss) from continuing operations
235
(12)
Group's share of other comprehensive income (loss)
42
74
Group's share of total comprehensive income (loss)
277
61
NOK in millions
2022
2021
Statement of financial position
4 401
4 910
Current assets excluding cash and cash equivalents
1 781
1 647
Cash and
\u00a0
cash equivalents
144
191
Non-current non-interest-bearing
\u00a0
liabilities
(442)
(514)
Non-current interest-bearing liabilities
(1 948)
(2 252)
Current non-interest-bearing
\u00a0
liabilities
(1 971)
(1 940)
Total equity
1 964
2 042
Group's share of equity
\u00a0
982
1 021
Goodwill
\u00a0
related to
\u00a0
the Group's
\u00a0
investment
387
399
Carrying
\u00a0
amount of
\u00a0
investment
1 369
1 420
Dividends received
285
501
.
Joint operations
The Group is part of four joint
\u00a0
arrangements for networks sharing in Sweden, Denmark,
\u00a0
and Finland. These joint arrangements are structured
through separate
\u00a0
vehicles.
\u00a0
The activities
\u00a0
are designed
\u00a0
for the provision
\u00a0
of output
\u00a0
to the investors
\u00a0
and hence
\u00a0
these arrangements
\u00a0
are classified
\u00a0
as
joint operations.
Joint Operation
Description
Ownership
\u00a0
interest in
\u00a0
%
3G Infrastructure
\u00a0
Services
AB
Joint operation with the mobile operator 3
\u00a0
in Sweden
1)
50
Net4Mobility HB
Joint operation under partnership agreement with the
\u00a0
mobile operator Tele2 Sverige AB in
Sweden
1)
50
TT Netv\u00e6rket P/S
Joint operation
\u00a0
with the
\u00a0
mobile operator
\u00a0
TeliaSonera
\u00a0
Mobile Holding
\u00a0
AB in Denmark
50
Suomen Yhteisverkko
\u00a0
Oy
Joint operations with mobile Operator Telia Finland Oy
\u00a0
in Finland
2)
49
.
1)
Under Swedish law, all partners in a partnership are
\u00a0
jointly and severally liable for all obligations in a partnership.
2)
According to the shareholder\u2019s agreement, both partners
\u00a0
in are jointly and severally liable for all obligations
\u00a0
in the joint undertaking.
Associated companies are normally those entities where Telenor
\u00a0
has between 20 to 50 percent ownership. Joint
arrangements are those entities where Telenor shares control with
\u00a0
other parties. On 30 November 2022, the
subsidiary Digi in Malaysia merged with Celcom. This resulted
\u00a0
in a derecognition as a subsidiary of Telenor with a
gain of NOK 32.9 billion. After the merger, CelcomDigi is an associated
\u00a0
company with Telenor having an ownership
percentage of 33.1%.
Accounting policies
\u00a0
Associates
\u00a0
are those
\u00a0
entities
\u00a0
where Telenor
\u00a0
has significant
\u00a0
influence,
\u00a0
but not control
\u00a0
or joint control,
\u00a0
usually
\u00a0
between
\u00a0
20 to 50 percent
\u00a0
voting
power. Joint
\u00a0
ventures are
\u00a0
those entities
\u00a0
where unanimous
\u00a0
consent
\u00a0
is required
\u00a0
by the owners
\u00a0
on important
\u00a0
decision
\u00a0
and where
\u00a0
the parties
\u00a0
have
rights to net assets. Interests in joint
\u00a0
ventures and associates are accounted for using
\u00a0
the equity method. The investments are initially
\u00a0
recognised
at cost (including transaction costs) and subsequently
\u00a0
adjusted for the share of profits and
\u00a0
losses, dividends received and impairment. The profit
and losses
\u00a0
are presented
\u00a0
on a separate
\u00a0
line in the
\u00a0
income statement.
An investment
\u00a0
is a joint
\u00a0
operation
\u00a0
when unanimous
\u00a0
consent is
\u00a0
required
\u00a0
by the owners
\u00a0
on important
\u00a0
decisions
\u00a0
and Telenor
\u00a0
and the parties
\u00a0
have
rights to
\u00a0
specific
\u00a0
assets and
\u00a0
obligations.
\u00a0
These entities
\u00a0
are consolidated
\u00a0
on a line-by-line
\u00a0
basis with
\u00a0
a share of
\u00a0
revenues and
\u00a0
costs, and
\u00a0
the specific
assets and
\u00a0
liabilities
\u00a0
or the proportionate
\u00a0
share of
\u00a0
jointly
\u00a0
owned assets
\u00a0
and liabilities.
For investments
\u00a0
where financial
\u00a0
statements
\u00a0
are not
\u00a0
available
\u00a0
at the time
\u00a0
Telenor publishes
\u00a0
its report,
\u00a0
the share
\u00a0
of net income
\u00a0
is recognised
\u00a0
with a
one quarter
\u00a0
lag. Adjustments
\u00a0
are made
\u00a0
for significant
\u00a0
transactions
\u00a0
or events
\u00a0
known in
\u00a0
the market.
\u00a0
To ensure
\u00a0
consistency,
\u00a0
the Annual
\u00a0
Report is
\u00a0
not
updated in situations where the financial statements
\u00a0
for the investee are made available after fourth
\u00a0
quarter and before the issuance of the
\u00a0
Annual
Report, unless
\u00a0
the transactions
\u00a0
or events
\u00a0
are significant.
Associated companies
\u00a0
and joint ventures
NOK in millions
2022
2021
Balance as of 1 January
5 683
6 417
Additions
35 089
393
Disposals
1)
(432)
3
Share of
\u00a0
net income
\u00a0
(losses)
2)
(232)
(480)
Share of
\u00a0
other comprehensive
\u00a0
income
46
79
Dividends received
(575)
(532)
Translation differences
106
(198)
Balance as of 31 December
39 686
5 683
Of which
\u00a0
investment
\u00a0
in CelcomDigi
34 436
-
Of which investment in Telenor Microfinance Bank
\u00a0
Limited
5)
828
952
Of which investment in Carousell
6)
2 660
2 619
Of which
\u00a0
investment
\u00a0
in Allente
1 369
1 420
Of which
\u00a0
investment
\u00a0
in others
393
692
1)
Mainly relates to the disposal of Wave Money during
\u00a0
2022.
2)
Share of net income (loss) includes the Group\u2019s share
\u00a0
of net income (loss) after taxes, amortisation of excess
\u00a0
values, impairments, and adjustment for
differences in accounting policies.
\u00a0
3)
Of which NOK 0.3 billion from Allente and NOK 0.3
\u00a0
billion from CelcomDigi in 2022, and NOK 0.5 billion
\u00a0
from Allente in 2021.
\u00a0
4)
Of which NOK 34.1 billion relates to the market
\u00a0
value of the investment retained on disposal of
\u00a0
Digi.
5)
Of which allocated to goodwill NOK 0.8 billion in
\u00a0
2022 and NOK 0.9 billion in 2021.
6)
Of which allocated to goodwill NOK 2.7 billion in 2022
\u00a0
and NOK 2.1 billion in 2021.
As announced in June 2021, Telenor and Axiata
\u00a0
Group Berhad entered into an agreement to
\u00a0
merge Digi.Com Berhad and Celcom Axiata Berhad
\u00a0
in
Malaysia.
\u00a0
The merger
\u00a0
of the telecommunication
\u00a0
operations
\u00a0
of Celcom
\u00a0
and Digi
\u00a0
in Malaysia
\u00a0
was completed
\u00a0
on 30 November
\u00a0
2022. On
\u00a0
completion,
Digi issued 3.96 billion shares to Celcom\u2019s owner
\u00a0
Axiata in addition to making cash payments
\u00a0
of NOK 5.4 billion. The share issue
\u00a0
diluted Telenor\u2019s
ownership to 32.5%, Telenor lost control
\u00a0
over Digi, and Digi was deconsolidated and
\u00a0
recognised as an associated company as of 30
\u00a0
November
2022. As part of the transaction to
\u00a0
bring Telenor and Axiata to equal ownership, Telenor acquired
\u00a0
at the same date 73.4 million shares
\u00a0
from Axiata
for an amount of NOK 667 million. Telenor\u2019s
\u00a0
ownership after the transaction in CelcomDigi is 33.1%. The
\u00a0
gain of NOK 32.9 billion was recognised
\u00a0
on
the date
\u00a0
of losing
\u00a0
control over
\u00a0
Digi based
\u00a0
on a market
\u00a0
value of
\u00a0
the combined
\u00a0
entity as
\u00a0
of first
\u00a0
day of trading
\u00a0
i.e., 1 December
\u00a0
2022, which
\u00a0
was NOK
34.1 billion
\u00a0
for Telenor\u2019s
\u00a0
interest in
\u00a0
the new company
\u00a0
CelcomDigi.
\u00a0
See note 12
\u00a0
for more
\u00a0
information.
During 2022, Telenor injected NOK 0.2 billion
\u00a0
representing its proportionate share of the capital
\u00a0
into Telenor Microfinance Bank Limited (TMB).
Share of
\u00a0
net loss for
\u00a0
2022 includes
\u00a0
share of
\u00a0
losses related
\u00a0
to TMB of
\u00a0
NOK 0.2
\u00a0
billion (NOK
\u00a0
0.3 billion
\u00a0
in 2021).
As announced on 17 January 2022, Telenor
\u00a0
entered into an agreement with Yoma Strategic
\u00a0
to sell the Group's 51%
\u00a0
ownership share in Digital
Money Myanmar Limited (Wave Money) to Yoma MFS
\u00a0
Holdings Pte. Ltd, a subsidiary of Yoma Strategic.
\u00a0
The transaction was closed on 7 December
2022 for
\u00a0
a cash consideration
\u00a0
of NOK 0.4
\u00a0
billion.
\u00a0
The loss recognised
\u00a0
on disposal
\u00a0
was NOK 35
\u00a0
million during
\u00a0
2022.
In 2022,
\u00a0
Telenor\u2019s
\u00a0
economic
\u00a0
interest
\u00a0
in Carousell
\u00a0
was diluted
\u00a0
following
\u00a0
new capital
\u00a0
investment
\u00a0
of USD 15
\u00a0
million.
\u00a0
The loss of
\u00a0
NOK 36 million
\u00a0
was
recognised during 2022 on deemed
\u00a0
disposal.
\u00a0
As of 31 December 2022, Telenor\u2019s economic
\u00a0
interest in Carousell stands at 32.4%.
\u00a0
During 2021, new
capital
\u00a0
of USD 100
\u00a0
million was
\u00a0
raised by
\u00a0
Carousell
\u00a0
leading
\u00a0
to the dilution
\u00a0
of Telenor\u2019s
\u00a0
economic
\u00a0
interest
\u00a0
in Carousell
\u00a0
from 37.4%
\u00a0
to 33.6%
\u00a0
as of 31
December 2021. The gain of NOK 21 million
\u00a0
was recognised during 2021.
Significant associates
\u00a0
and joint ventures
CelcomDigi is an associated company where Telenor controls
\u00a0
33.1% of the shares and voting rights.
\u00a0
The associate is accounted for using the
\u00a0
equity
method. CelcomDigi is a telecommunication company, listed
\u00a0
on Bursa Malaysia Berhad and became the
\u00a0
largest mobile network operator
\u00a0
in
Malaysia through a merger between the former Telenor
\u00a0
subsidiary Digi and Celcom Axiata Berhad in November 2022.
\u00a0
Telenor share of
CelcomDigi\u2019s
\u00a0
market value
\u00a0
amounted
\u00a0
to NOK 34.7
\u00a0
billion as
\u00a0
of 31 December
\u00a0
2022.
The Group
\u00a0
is not aware
\u00a0
of significant
\u00a0
restrictions
\u00a0
limiting
\u00a0
the ability
\u00a0
of CelcomDigi
\u00a0
to transfer
\u00a0
funds to
\u00a0
its shareholders.
\u00a0
For example,
\u00a0
under the
form of dividends,
\u00a0
repayment
\u00a0
of advances
\u00a0
or loans
\u00a0
made.
As the financial
\u00a0
quarterly
\u00a0
results of
\u00a0
the listed
\u00a0
company CelcomDigi
\u00a0
will not
\u00a0
always be
\u00a0
published
\u00a0
at the time
\u00a0
Telenor reports
\u00a0
its quarterly
\u00a0
results,
Telenor will
\u00a0
include the
\u00a0
share of
\u00a0
profits from
\u00a0
CelcomDigi
\u00a0
with a one-quarter
\u00a0
lag. This
\u00a0
means that
\u00a0
the fourth
\u00a0
quarter results
\u00a0
of CelcomDigi
\u00a0
consisting
of December
\u00a0
2022 will
\u00a0
be included
\u00a0
in the Telenor\u2019s
\u00a0
Q1 2023
\u00a0
report.
The following table sets forth the summarised
\u00a0
financial information of CelcomDigi. The figures reflect the
\u00a0
opening balance for CelcomDigi on 1
December 2022, adjusted for dividend received by Telenor
\u00a0
in December 2022. The financial information includes
\u00a0
the preliminary allocation of the
excess values recognised as part of the merger, and
\u00a0
reconciliation with the carrying amount of the investment
\u00a0
for the Group.
NOK in millions
2022
Statement of financial position
77 836
Current assets excluding cash and cash equivalents
9 593
Cash and
\u00a0
cash equivalents
7 744
Non-current non-interest-bearing
\u00a0
liabilities
(6 978)
Non-current interest-bearing liabilities
(33 310)
Current non-interest-bearing
\u00a0
liabilities
(8 194)
Total equity
46 691
Group's share of equity
\u00a0
15 455
Goodwill
\u00a0
related to
\u00a0
the Group's
\u00a0
investment
18 981
Carrying
\u00a0
amount of
\u00a0
investment
34 436
Dividends received
289
Allente
Allente
\u00a0
Group AB
\u00a0
(Allente)
\u00a0
is a joint
\u00a0
venture where
\u00a0
Telenor
\u00a0
controls
\u00a0
50% of the
\u00a0
shares and
\u00a0
the voting
\u00a0
rights. The
\u00a0
joint venture
\u00a0
is accounted
\u00a0
for using
the equity method. Allente is a Nordic TV
\u00a0
distributor broadcasting via satellite and internet TV,
\u00a0
to customers within Norway, Sweden, Denmark, and
Finland. Allente was established in May 2020 through
\u00a0
a merger between the former Telenor subsidiary Canal
\u00a0
Digital and Nordic Entertainment
The following
\u00a0
table sets
\u00a0
forth summarised
\u00a0
financial
\u00a0
information
\u00a0
of Allente,
\u00a0
including
\u00a0
excess values
\u00a0
from the
\u00a0
merger in
\u00a0
2020, and
\u00a0
reconciliation
\u00a0
with
the carrying
\u00a0
amount of
\u00a0
the investment
\u00a0
for the Group:
NOK in millions
2022
2021
Statement of comprehensive income
Revenue
6 472
6 826
EBITDA
1 181
593
Depreciation
\u00a0
and amortisation
(526)
(663)
(62)
-
(143)
46
Net income
470
(25)
Other comprehensive
\u00a0
income(loss)
83
148
Total comprehensive
\u00a0
income (loss)
553
123
Group's ownership
\u00a0
in %
50
50
Group's share of net income (loss) from continuing operations
235
(12)
Group's share of other comprehensive income (loss)
42
74
Group's share of total comprehensive income (loss)
277
61
NOK in millions
2022
2021
Statement of financial position
4 401
4 910
Current assets excluding cash and cash equivalents
1 781
1 647
Cash and
\u00a0
cash equivalents
144
191
Non-current non-interest-bearing
\u00a0
liabilities
(442)
(514)
Non-current interest-bearing liabilities
(1 948)
(2 252)
Current non-interest-bearing
\u00a0
liabilities
(1 971)
(1 940)
Total equity
1 964
2 042
Group's share of equity
\u00a0
982
1 021
Goodwill
\u00a0
related to
\u00a0
the Group's
\u00a0
investment
387
399
Carrying
\u00a0
amount of
\u00a0
investment
1 369
1 420
Dividends received
285
501
.
Associates
\u00a0
are those
\u00a0
entities
\u00a0
where Telenor
\u00a0
has significant
\u00a0
influence,
\u00a0
but not control
\u00a0
or joint control,
\u00a0
usually
\u00a0
between
\u00a0
20 to 50 percent
\u00a0
voting
power. Joint
\u00a0
ventures are
\u00a0
those entities
\u00a0
where unanimous
\u00a0
consent
\u00a0
is required
\u00a0
by the owners
\u00a0
on important
\u00a0
decision
\u00a0
and where
\u00a0
the parties
\u00a0
have
rights to net assets. Interests in joint
\u00a0
ventures and associates are accounted for using
\u00a0
the equity method. The investments are initially
\u00a0
recognised
at cost (including transaction costs) and subsequently
\u00a0
adjusted for the share of profits and
\u00a0
losses, dividends received and impairment. The profit
and losses
\u00a0
are presented
\u00a0
on a separate
\u00a0
line in the
\u00a0
income statement.
An investment
\u00a0
is a joint
\u00a0
operation
\u00a0
when unanimous
\u00a0
consent is
\u00a0
required
\u00a0
by the owners
\u00a0
on important
\u00a0
decisions
\u00a0
and Telenor
\u00a0
and the parties
\u00a0
have
rights to
\u00a0
specific
\u00a0
assets and
\u00a0
obligations.
\u00a0
These entities
\u00a0
are consolidated
\u00a0
on a line-by-line
\u00a0
basis with
\u00a0
a share of
\u00a0
revenues and
\u00a0
costs, and
\u00a0
the specific
assets and
\u00a0
liabilities
\u00a0
or the proportionate
\u00a0
share of
\u00a0
jointly
\u00a0
owned assets
\u00a0
and liabilities.
CelcomDigi is an associated company where Telenor controls
\u00a0
33.1% of the shares and voting rights.
\u00a0
The associate is accounted for using the
\u00a0
equity
method. CelcomDigi is a telecommunication company, listed
\u00a0
on Bursa Malaysia Berhad and became the
\u00a0
largest mobile network operator
\u00a0
in
Malaysia through a merger between the former Telenor
\u00a0
subsidiary Digi and Celcom Axiata Berhad in November 2022.
\u00a0
Telenor share of
CelcomDigi\u2019s
\u00a0
market value
\u00a0
amounted
\u00a0
to NOK 34.7
\u00a0
billion as
\u00a0
of 31 December
\u00a0
2022.
The Group
\u00a0
is not aware
\u00a0
of significant
\u00a0
restrictions
\u00a0
limiting
\u00a0
the ability
\u00a0
of CelcomDigi
\u00a0
to transfer
\u00a0
funds to
\u00a0
its shareholders.
\u00a0
For example,
\u00a0
under the
form of dividends,
\u00a0
repayment
\u00a0
of advances
\u00a0
or loans
\u00a0
made.
As the financial
\u00a0
quarterly
\u00a0
results of
\u00a0
the listed
\u00a0
company CelcomDigi
\u00a0
will not
\u00a0
always be
\u00a0
published
\u00a0
at the time
\u00a0
Telenor reports
\u00a0
its quarterly
\u00a0
results,
Telenor will
\u00a0
include the
\u00a0
share of
\u00a0
profits from
\u00a0
CelcomDigi
\u00a0
with a one-quarter
\u00a0
lag. This
\u00a0
means that
\u00a0
the fourth
\u00a0
quarter results
\u00a0
of CelcomDigi
\u00a0
consisting
of December
\u00a0
2022 will
\u00a0
be included
\u00a0
in the Telenor\u2019s
\u00a0
Q1 2023
\u00a0
report.
The following table sets forth the summarised
\u00a0
financial information of CelcomDigi. The figures reflect the
\u00a0
opening balance for CelcomDigi on 1
December 2022, adjusted for dividend received by Telenor
\u00a0
in December 2022. The financial information includes
\u00a0
the preliminary allocation of the
excess values recognised as part of the merger, and
\u00a0
reconciliation with the carrying amount of the investment
\u00a0
for the Group.
NOK in millions
2022
Statement of financial position
77 836
Current assets excluding cash and cash equivalents
9 593
Cash and
\u00a0
cash equivalents
7 744
Non-current non-interest-bearing
\u00a0
liabilities
(6 978)
Non-current interest-bearing liabilities
(33 310)
Current non-interest-bearing
\u00a0
liabilities
(8 194)
Total equity
46 691
Group's share of equity
\u00a0
15 455
Goodwill
\u00a0
related to
\u00a0
the Group's
\u00a0
investment
18 981
Carrying
\u00a0
amount of
\u00a0
investment
34 436
Dividends received
289
Allente
Allente
\u00a0
Group AB
\u00a0
(Allente)
\u00a0
is a joint
\u00a0
venture where
\u00a0
Telenor
\u00a0
controls
\u00a0
50% of the
\u00a0
shares and
\u00a0
the voting
\u00a0
rights. The
\u00a0
joint venture
\u00a0
is accounted
\u00a0
for using
the equity method. Allente is a Nordic TV
\u00a0
distributor broadcasting via satellite and internet TV,
\u00a0
to customers within Norway, Sweden, Denmark, and
Finland. Allente was established in May 2020 through
\u00a0
a merger between the former Telenor subsidiary Canal
\u00a0
Digital and Nordic Entertainment
The following
\u00a0
table sets
\u00a0
forth summarised
\u00a0
financial
\u00a0
information
\u00a0
of Allente,
\u00a0
including
\u00a0
excess values
\u00a0
from the
\u00a0
merger in
\u00a0
2020, and
\u00a0
reconciliation
\u00a0
with
the carrying
\u00a0
amount of
\u00a0
the investment
\u00a0
for the Group:
NOK in millions
2022
2021
Statement of comprehensive income
Revenue
6 472
6 826
EBITDA
1 181
593
Depreciation
\u00a0
and amortisation
(526)
(663)
(62)
-
(143)
46
Net income
470
(25)
Other comprehensive
\u00a0
income(loss)
83
148
Total comprehensive
\u00a0
income (loss)
553
123
Group's ownership
\u00a0
in %
50
50
Group's share of net income (loss) from continuing operations
235
(12)
Group's share of other comprehensive income (loss)
42
74
Group's share of total comprehensive income (loss)
277
61
NOK in millions
2022
2021
Statement of financial position
4 401
4 910
Current assets excluding cash and cash equivalents
1 781
1 647
Cash and
\u00a0
cash equivalents
144
191
Non-current non-interest-bearing
\u00a0
liabilities
(442)
(514)
Non-current interest-bearing liabilities
(1 948)
(2 252)
Current non-interest-bearing
\u00a0
liabilities
(1 971)
(1 940)
Total equity
1 964
2 042
Group's share of equity
\u00a0
982
1 021
Goodwill
\u00a0
related to
\u00a0
the Group's
\u00a0
investment
387
399
Carrying
\u00a0
amount of
\u00a0
investment
1 369
1 420
Dividends received
285
501
.
Shares in subsidiaries
Office
in % 2022
in % 2021
Telenor Networks Holding AS
Norway
100.0
100.0
Telenor Global Shared Services AS
\u00a0
Norway
100.0
100.0
Telenor
\u00a0
Communication
\u00a0
II AS
Norway
100.0
100.0
Telenor Mobile Holding AS
\u00a0
Norway
100.0
100.0
Norway
100.0
100.0
Telenor Forsikring AS
Norway
100.0
100.0
Telenor Maritime AS 1)
Norway
98.9
98.9
Norway
100.0
100.0
Cinclus Technology AS
\u00a0
Norway
100.0
100.0
Telenor Digital AS 2)
Norway
0.0
100.0
Telenor Real Estate AS
Norway
100.0
100.0
1)
The remaining
\u00a0
1.1% of shares
\u00a0
in Telenor Maritime
\u00a0
AS are owned by
\u00a0
Telenor Communication
\u00a0
II AS.
2)
Telenor Digital
\u00a0
AS is merged
\u00a0
with Telenor
\u00a0
Linx AS which
\u00a0
is owned by Telenor
\u00a0
Networks Holding
\u00a0
AS in 2022.
Shares in subsidiaries
\u00a0
owned through
\u00a0
subsidiaries
Office
in % 2022
in % 2021
Telenor Networks Holding AS
Norway
100.0
100.0
Telenor Linx AS
Norway
100.0
100.0
Telenor
\u00a0
Svalbard
\u00a0
AS
Norway
100.0
100.0
Norway
100.0
100.0
Telenor Nordic Towers AS
Norway
100.0
100.0
Telenor Satellite AS
Norway
100.0
100.0
Norway
100.0
Telenor Communication II AS
Telenor Financial Services AS
5)
Norway
0.0
100.0
Singapore
100.0
100.0
SnT East
\u00a0
Holding
\u00a0
AS
Norway
100.0
100.0
Telenor
\u00a0
India Private
\u00a0
Ltd
India
100.0
100.0
Norkring Belgi\u00eb N.V.
Belgium
75.0
75.0
Norway
100.0
100.0
Telenor
\u00a0
Marketplace
\u00a0
Invest AS
Norway
100.0
100.0
Telenor South Asia Investment Pte Ltd
6)
Singapore
100.0
0.0
Telenor Mobile Holding AS
Telenor
\u00a0
Mobile Communications
\u00a0
AS
Norway
100.0
100.0
Telenor Danmark Holding A/S
Denmark
100.0
100.0
Sweden
100.0
100.0
Telenor Connexion AB
\u00a0
Sweden
100.0
100.0
Canal Digital
\u00a0
Finland Oy
Finland
100.0
100.0
Telenor Finland Holding Oy
Finland
100.0
100.0
Telenor Maritime AS
Telenor
\u00a0
Maritime
\u00a0
Inc
USA
100.0
100.0
Telenor
\u00a0
Maritime
\u00a0
AB
Sweden
100.0
100.0
Telenor
\u00a0
Maritime
\u00a0
Pte
Singapore
100.0
100.0
Telenor
\u00a0
Maritime
\u00a0
Oy
Finland
100.0
100.0
Telenor Real Estate AS
Telenor Eiendom Harelokken AS
Norway
100.0
100.0
Norway
100.0
100.0
Telenor
\u00a0
M\u00f8re og Romsdal
\u00a0
og Tr\u00f8ndelag
\u00a0
2 AS
Norway
100.0
100.0
Telenor Vestlandet og Rogaland 2 AS
Norway
100.0
100.0
Telenor Agder Vestfold og Telemark 2 AS
Norway
100.0
100.0
Telenor Viken og Innlandet 2 AS
Norway
100.0
100.0
Telenor
\u00a0
\u00d8vre Strandgate
\u00a0
5 2 AS
Norway
100.0
100.0
Telenor L\u00e5veveien 55 AS
Norway
100.0
100.0
Telenor Jel\u00f8y Radio AS
Norway
100.0
100.0
Telenor Tryvann Radio AS
Norway
100.0
100.0
Telenor Festekontrakter AS
Norway
100.0
100.0
Telenor Linx AS
2)
Norway
100.0
100.0
1)
The company was presented as Telenor Global Services
\u00a0
AS earlier.
2)
Telenor Digital AS is merged with Telenor Linx AS in
\u00a0
2022.
3)
The company was presented as Telenor Tower Holding
\u00a0
AS earlier.
4)
The company is
\u00a0
newly established
\u00a0
in 2022.
5)
The company is
\u00a0
merged with Telenor
\u00a0
Communication
\u00a0
II AS in 2022.
6)
The company is sold from Telenor Mobile Communications
\u00a0
AS to Telenor Communication II AS in 2022.
Other significant
\u00a0
subsidiaries
\u00a0
(owned through
\u00a0
holding companies)
Office
Denmark
Telenor
\u00a0
Pakistan
\u00a0
(Private)
\u00a0
Ltd.
Pakistan
Total Access Communications Plc. (dtac)
Thailand
Bangladesh
Unitech Wireless Private Limited
\u00a0
India
DNA Plc
Finland
Telenor consolidated Digi before it was merged with Celcom in November 2022
\u00a0
and reported as an associate. Digi was listed on Bursa Malaysia
Securities Berhad and the shares in Digi were widely dispersed. Telenor owned 49%
\u00a0
of the shares, and 98% of the shares had to be present at
the General Meeting for Telenor not to have the majority of the votes. As a
\u00a0
consequence of this and based on experience from past General
Meetings, Telenor had the power to direct Digi\u2019s activities. The assessment
\u00a0
was that the ability to exercise control was upheld through a
majority of the votes at the General Meeting and at the Board of Directors
\u00a0
meetings. The consolidation of Digi based on de facto control was
assessed on an ongoing basis.
NOTE 36
Related parties
Telenor ASA is 53.97% owned by the Kingdom of Norway represented
\u00a0
through the Ministry of Trade, Industry and
Fisheries (MTIF). Transactions between Telenor and Norwegian authorities
\u00a0
are therefore regarded as related party
transactions. Further, transactions between Telenor and
\u00a0
its associated companies and joint ventures are regarded
as related party transactions. All transactions with these related parties
\u00a0
are based on the arm\u2019s length principle.
Transaction
\u00a0
with Norwegian
\u00a0
authorities
The Norwegian
\u00a0
telecommunications
\u00a0
market is
\u00a0
governed
\u00a0
by the Electronic
\u00a0
Communications
\u00a0
Act of 4
\u00a0
July 2003
\u00a0
and other
\u00a0
regulations
\u00a0
issued
pursuant to this Act. The Group provides
\u00a0
designated Universal Service Obligations (USO) through an
\u00a0
agreement between the Group and the
Norwegian Ministry
\u00a0
of Local Government and Regional Development (MLGRD).
\u00a0
The USO obligation entails among other things
\u00a0
the provision of
public voice telephony and basic access to internet
\u00a0
to all households and companies. Telenor is
\u00a0
imposed USO obligations to provide text telephony
services
\u00a0
for the deaf
\u00a0
and hearing
\u00a0
impaired,
\u00a0
but does
\u00a0
not receive
\u00a0
any compensation
\u00a0
for providing
\u00a0
the USO services.
\u00a0
In addition, Telenor was in 2022 and 2021
\u00a0
subject to Special Service Obligations (SSO), mainly
\u00a0
related to security and emergency following an
agreement
\u00a0
between
\u00a0
the Norwegian
\u00a0
Ministry
\u00a0
of Justice
\u00a0
and Public
\u00a0
Security and
\u00a0
Telenor Coastal
\u00a0
Radio. In
\u00a0
2022 and
\u00a0
2021, NOK
\u00a0
97 million
\u00a0
and NOK 93
million, respectively, was received as compensation under
\u00a0
this agreement.
\u00a0
Telenor may also receive compensation for the
\u00a0
obligations to fulfil additional requirements on the
\u00a0
network to serve national security issues and
other statutory
\u00a0
services.
\u00a0
In 2022
\u00a0
and 2021,
\u00a0
a refund related
\u00a0
to such activities
\u00a0
of NOK 110
\u00a0
million and
\u00a0
NOK 57 million,
\u00a0
respectively,
\u00a0
was received.
\u00a0
In 2022 and 2021, Telenor received NOK 274 and NOK
\u00a0
67 million in government grants,
\u00a0
respectively, in connection with construction of
\u00a0
broadband
networks
\u00a0
in designated
\u00a0
areas in
\u00a0
Norway.
Telenor pays an annual fee to Norwegian
\u00a0
Communications Authority and an annual levy to MLGRD
\u00a0
for delivering electronic communication
services,
\u00a0
including
\u00a0
payments
\u00a0
for frequencies
\u00a0
and numbers.
\u00a0
The fee/levy
\u00a0
was NOK 185
\u00a0
million and
\u00a0
NOK 189 million
\u00a0
in 2022
\u00a0
and 2021,
\u00a0
respectively.
Telenor invested NOK 1.2 billion in spectrum in
\u00a0
the 2.6 GHz and 3.6 GHz frequency
\u00a0
bands in Norway in 2021. The allocation in the
\u00a0
3.6 GHz band
became usable from 1 January 2022, while
\u00a0
the 2.6 GHz band allocation could be
\u00a0
used from 1 January 2023. Expiry of
\u00a0
both licenses are
\u00a0
31 December
2042.
In addition,
\u00a0
Telenor
\u00a0
sold transmission
\u00a0
capacity
\u00a0
and related
\u00a0
services
\u00a0
in the digital
\u00a0
and analogue
\u00a0
terrestrial
\u00a0
transmission
\u00a0
network to
\u00a0
Norsk
rikskringkasting
\u00a0
AS of NOK
\u00a0
226 million
\u00a0
in 2022
\u00a0
and NOK 210
\u00a0
million in
\u00a0
2021.
Telenor provides mobile and fixed telephony services, leased
\u00a0
lines, customer equipment, internet connections, TV distributions
\u00a0
and other services
to the state
\u00a0
and companies
\u00a0
controlled
\u00a0
by the state
\u00a0
in the normal
\u00a0
course of
\u00a0
business
\u00a0
and at arms-length
\u00a0
prices.
\u00a0
It also purchases
\u00a0
services,
\u00a0
such as
postal services,
\u00a0
in the normal
\u00a0
course of
\u00a0
business and
\u00a0
at arm\u2019s-length
\u00a0
prices.
\u00a0
Details of
\u00a0
such transactions
\u00a0
are not included
\u00a0
in this note.
\u00a0
Transactions
\u00a0
with associated
\u00a0
companies and
\u00a0
joint ventures
2022
2021
NOK in millions
Sales to
Sales to
483
(791)
499
(696)
Amounts receivable
\u00a0
from and amounts
\u00a0
due to associated
\u00a0
companies and
\u00a0
joint ventures
2022
2021
NOK in millions
Receivables
Payables
Receivables
Payables
210
(41)
88
(38)
Sales to associated companies in 2022 and 2021
\u00a0
include NOK 420 million and NOK 432
\u00a0
million in sale of satellite capacity to Allente
\u00a0
Group.
Purchases
\u00a0
from Strex
\u00a0
AS regarding
\u00a0
mobile content
\u00a0
services
\u00a0
were NOK
\u00a0
578 million
\u00a0
in 2022
\u00a0
and NOK 542
\u00a0
million in
\u00a0
2021.
CelcomDigi was accounted for as an associate
\u00a0
company from December 2022 upon the completion
\u00a0
of the merger between Digi and Celcom.
Telenor has
\u00a0
a receivable
\u00a0
against CelcomDigi
\u00a0
of NOK 131
\u00a0
million of
\u00a0
which NOK
\u00a0
72 million
\u00a0
are related
\u00a0
to integration
\u00a0
costs from
\u00a0
2021 and
\u00a0
2022.
Transactions with subsidiaries and joint operations have
\u00a0
been eliminated on consolidation and do not
\u00a0
represent related party transactions. See
note 35 for further information about joint
\u00a0
operations and note 34 further information about
\u00a0
group
\u00a0
companies.
\u00a0
For compensation
\u00a0
to key management
\u00a0
personnel,
\u00a0
please refer
\u00a0
to note 37
\u00a0
Key management
\u00a0
compensation
\u00a0
and chapter
\u00a0
11 and 12
\u00a0
in the corporate
governance
\u00a0
section of
\u00a0
the Board
\u00a0
of Directors\u2019
\u00a0
report.
NOTE 37
Key management compensation
Key management
\u00a0
compensation
The table below outlines key management compensation
\u00a0
for 2022 and 2021 by categories. The figures
\u00a0
presented in each category are the total
amounts for both the President & CEO
\u00a0
and the Group Leadership Team (GLT).
\u00a0
NOK in millions
2022
7)
2021
7)
Base salary
1)
39.3
35.3
Benefits
2)
4.0
3.8
Short-term incentive (STI)
3)
11.5
10.6
Long-term incentive (LTI)
4)
11.3
8.7
Extraordinary items
5)
0.9
Pension
6)
6.9
6.0
Total compensation
73.0
65.3
1)
Base salary includes holiday pay, if applicable
\u00a0
.
2)
Benefits include any type of cash or benefit in kind
\u00a0
provided, such as car allowance or car benefit,
\u00a0
insurances, mobile phone and broadband subscriptions
\u00a0
and
expatriate benefits such as accommodation and children
\u00a0
schooling.
\u00a0
3)
The STI amounts reflect the annual bonus earned in
\u00a0
the respective year. Any applicable holiday pay is
\u00a0
reported under \u2018Base salary\u2019.
4)
The LTI is a multi-year incentive plan that is a
\u00a0
restricted share plan under which participants can receive
\u00a0
Telenor ASA shares or phantom shares for
\u00a0
a defined
maximum percentage of their annual base salary. The
\u00a0
shares are locked for a period of 3 years (4 years
\u00a0
for the shares granted prior to 2020). The
\u00a0
amounts
reported for the LTI plan reflect the annual cost of
\u00a0
all active programs in that year.
5)
In 2021, Telenor issued a one-time compensation
\u00a0
to recognise the hardship the extensive restrictions
\u00a0
related to travel and freedom of movement had on
\u00a0
their
expatriate population and their families. The compensation
\u00a0
was equivalent to one-month base salary.
6)
The calculations of pension benefits earned are based
\u00a0
on the same actuarial and other assumptions as
\u00a0
used in the pension benefit calculations in note
\u00a0
21.
7)
Taxes in Norway incurred for a manager on assignment
\u00a0
to Singapore of NOK 6.6 million in 2022 (NOK 5.6 million
\u00a0
in 2021) due to double taxation in Singapore
\u00a0
and
Norway as a result of travel restrictions during the
\u00a0
Covid-19 pandemic are not included in table above.
In addition
\u00a0
to the above,
\u00a0
fees to the
\u00a0
Board of
\u00a0
Directors
\u00a0
amount to
\u00a0
NOK 6.4
\u00a0
million in
\u00a0
2022 and
\u00a0
NOK 5.5 million
\u00a0
in 2021.
\u00a0
The fees
\u00a0
consist of
\u00a0
an annual
fee reflecting the role in the Board and
\u00a0
additional fees for any board committee the respective director
\u00a0
takes part in.
Loans to employees
Total loans
\u00a0
to employees
\u00a0
were NOK 3.9
\u00a0
million as
\u00a0
of 31 December
\u00a0
2022 and
\u00a0
NOK 5.1 million
\u00a0
as of 31
\u00a0
December 2021.
.
NOTE 38
Fees to external auditor
The table
\u00a0
below summarises
\u00a0
incurred
\u00a0
audit fees
\u00a0
for 2022
\u00a0
and 2021
\u00a0
and fees
\u00a0
for audit
\u00a0
related services,
\u00a0
tax services
\u00a0
and other
\u00a0
services.
\u00a0
Fees include
both Norwegian and foreign subsidiaries.
Audit fees
Fees for further
\u00a0
assurance
services
Fees for tax
\u00a0
services
Other fees
NOK in millions,
\u00a0
excluding VAT
2022
2021
2022
2021
2022
2021
2022
2021
7.0
6.1
0.7
0.3
0.6
0.6
0.1
2.0
Other Group
\u00a0
companies
32.7
32.3
5.6
4.7
23.0
14.7
8.6
8.8
Total Group auditors
39.7
38.3
6.3
5.0
23.7
15.3
8.7
10.8
Other auditors in subsidiaries
0.5
0.9
0.0
0.0
0.0
0.0
0.0
0.0
Total
40.2
39.2
6.4
5.0
23.7
15.3
8.7
10.8
Fees for audit services include fees associated
\u00a0
with the required statutory and financial audits.
\u00a0
Further assurance services principally include other
attestation services required by laws and regulations, attestations
\u00a0
related to information system, audits, attestations and
\u00a0
agreed upon procedures
reported on to regulators and other third
\u00a0
parties.
\u00a0
Fees for
\u00a0
tax services
\u00a0
include
\u00a0
tax compliance
\u00a0
and advice
\u00a0
regarding
\u00a0
tax rules
\u00a0
and consequences,
\u00a0
as well as
\u00a0
tax due
\u00a0
diligence
\u00a0
services in
\u00a0
connection
with acquisitions, disposals, and other transactions. Other
\u00a0
fees relate primarily to process/system/project/supplier reviews, financial
\u00a0
due diligence
services
\u00a0
and consultations
\u00a0
in connection
\u00a0
with acquisitions,
\u00a0
disposals,
\u00a0
and other
\u00a0
transactions.
NOTE 40
Events after the reporting period
Completion of
\u00a0
the amalgamation
\u00a0
of dtac and True
\u00a0
in Thailand
On 1 March 2023, Telenor announced the completion
\u00a0
of the amalgamation of the telco operations
\u00a0
of True and dtac in Thailand. The transaction
\u00a0
is
the largest telco merger in Southeast Asia by
\u00a0
combined enterprise value. The name of the
\u00a0
new company is True Corporation. Telenor\u2019s ownership
in True Corporation after the transaction is
\u00a0
30.3%. The gain from the divestment of dtac
\u00a0
will be reported in Q1 2023. True Corporation will
\u00a0
be
accounted for as an associate using the
\u00a0
equity method going forward. The share of
\u00a0
profits or losses from True Corporation will
\u00a0
be included in the
Asia segment from Q1 2023.
Partial divestment
\u00a0
of Telenor Fiber
\u00a0
AS (Norway)
On 1 February
\u00a0
2023, Telenor
\u00a0
announced
\u00a0
the closing
\u00a0
of the transaction
\u00a0
to divest
\u00a0
30 percent
\u00a0
of the newly
\u00a0
established
\u00a0
company, Telenor
Fiber AS, in Norway to a consortium
\u00a0
led by KKR. The agreed sales price represents
\u00a0
an enterprise value for the Norwegian fiber
\u00a0
business
of NOK 36.1
\u00a0
billion, resulting
\u00a0
in proceeds
\u00a0
of NOK 10.8
\u00a0
billion to
\u00a0
Telenor.
\u00a0
The transaction
\u00a0
results in
\u00a0
an increase
\u00a0
of equity
\u00a0
to shareholders
\u00a0
of
Telenor
\u00a0
ASA of around
\u00a0
NOK 7.6
\u00a0
billion.
Partial settlement
\u00a0
with the Indian
\u00a0
Department of Telecommunications
On 30 January
\u00a0
2023, Telenor
\u00a0
paid NOK 1.5
\u00a0
billion
\u00a0
to the Department
\u00a0
of Telecommunications
\u00a0
in India
\u00a0
related to
\u00a0
warranties
\u00a0
given to
\u00a0
Bharti
Airtel for the period Telenor had operations in
\u00a0
India. The payment is a partial settlement of the
\u00a0
dispute related to the basis for calculating
license payments and spectrum usage charges. The payment
\u00a0
made will reduce the provision recognised in
\u00a0
the statement of financial
position accordingly.
\u00a0
See note
\u00a0
23 Legal
\u00a0
disputes
\u00a0
and note
\u00a0
12 Held
\u00a0
for sale and
\u00a0
discontinued
\u00a0
operations.
Dividend proposed
\u00a0
or declared by
\u00a0
the Board of
\u00a0
Directors in
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subsidiaries with
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non-controlling
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interests
Dtac - Thailand
On 26 January
\u00a0
2023, the
\u00a0
Board of Directors
\u00a0
of dtac proposed
\u00a0
final dividend
\u00a0
for 2022
\u00a0
of THB 1.22
\u00a0
per share,
\u00a0
which corresponds
\u00a0
to
approximately NOK 0.8 billion total dividend and
\u00a0
approximately NOK 0.3 billion for the non-controlling
\u00a0
interests ownership share.
Grameenphone - Bangladesh
On 30 January 2023, the Board of Directors
\u00a0
of Grameenphone Ltd. proposed final dividend for
\u00a0
2022 of BDT 9.5 per share, which
corresponds to approximately NOK 1.2 billion total
\u00a0
dividend and approximately NOK 0.5 billion for the
\u00a0
non-controlling interests