2.3 Currency translation

The items included in the financial statements of each group entity are valued using the currency of the primary economic environment in which the group operates (the “functional currency”). Transactions in a foreign currency are translated into the functional currency using the exchange rate prevailing on the date of the transaction.

The consolidated financial statements are presented in Swiss francs. To prepare the consolidated financial statements, the assets and liabilities of foreign subsidiaries are converted into Swiss francs at the market rate as of the corresponding balance sheet date. Revenues and expenses are converted at the average currency exchange rate for the financial year. Translation differences and foreign currency gains on equity-like long-term loans are booked neutrally for profit purposes under currency differences in the shareholders’ equity. In the event of the disposal of a foreign subsidiary, the related accumulated translation differences booked on the income statement are de-recognised and disclosed as part of the profit or loss from the disposal.

The Orell Füssli Group used the following currency exchange rates (Market rate and annual average rate) for the 2020 and 2019 financial years:

Currency exchange rates

  Market rate   Annual average rate
    31.12.2020   31.12.2019   2020   2019
EUR at a rate of CHF   1.0824   1.0855   1.0703   1.1128
USD at a rate of CHF   0.8826   0.9677   0.9389   0.9938
GBP at a rate of CHF   1.2048   1.2761   1.2045   1.2690