IBERSOL | Annual Report 2021

ANNUAL REPORT 2021 recorded during the period. The resulting exchange difference is recorded in equity under the heading “Exchange rate reserves”. Goodwill and fair value adjustments arising from the acquisition of foreign entities are treated as assets and liabilities of that entity and translated into Euro according to the exchange rate at the balance sheet date. When a foreign entity is disposed, the accumulated exchange rate difference is rec- ognised in the income statement as a gain or loss on disposal. As at 31st December 2021 and 2020 the exchange rate used for conversion of trans- actions and balances denominated in Kwanzas in were, respectively: dec. 2020 Euro exchange rates (x foreign currency per 1 Euro) Rate on December, 31st 2020 Average interest rate year 2020 Angola Kwanza (AOA) 796,813 703,730 dec. 2021 Euro exchange rates (x foreign currency per 1 Euro) Rate on December, 31st 2021 Average interest rate year 2021 Angola Kwanza (AOA) 635,728 705,219 2.7 PROPERTY, PLANT AND EQUIPMENT Buildings and other constructions include own properties assigned to restaurant ac- tivities and expenses on works at third-party properties, in particular those required for setting up restaurant shops. Property, plant and equipment are presented at the acquisition cost, net of the re- spective amortisation and accumulated impairment losses. The historic cost includes all expenses attributable directly to the acquisition of goods. Costs with loans incurred and with loans obtained for the construction of property, plant and equipment are recognized as part of the construction cost of the asset. Subsequent costs are added to the amounts for which the good is recorded or rec- ognised as separate assets, as appropriate, only when it is probable that the compa- ny will obtain the underlying economic benefits and the cost may be reliably meas- ured. Other expenses on repairs and maintenance are recognised as an expense in the period in which they are incurred. 345