The true and fair image results from the application of the legal provisions on accounting matters, and the Directors have not considered it necessary to include any supplementary information.
b) Accounting principles
The consolidated annual accounts have been prepared in accordance with the accounting principles and policies established in the Accountancy Plan for Insurance Companies (here- inafter the “Plan”).
The Entity and the companies mentioned below restated all the elements of their tangible fixed assets and tangible investments, pursuant to Royal Decree-Act 7/1996, of 7 June:
› MAPFRE AGROPECUARIA.
› MAPFRE SEGUROS GENERALES Compañía de Seguros y Reaseguros, S.A (hereinafter “MAPFRE SEGUROS GENERALES”).
› MAPFRE GUANARTEME Compañía de Seguros Generales y Reaseguros de Canarias, S.A (hereinafter “MAPFRE GUANARTEME”).
› MUSINI Sociedad Anónima de Seguros y Reaseguros (hereinafter “MUSINI”). The effect of said restatement is described in notes 6.4, 6.5 and 6.10 of this Report.
c) Comparison of information
There are no reasons preventing from comparing the year’s annual accounts with those of the preceding year.
d) Changes in the Consolidation perimeter
Appendix 1 identifies the companies which were incorporated into the consolidation perimeter in this fiscal year, showing also information on their networth and results. The following sec- tions detail the changes having taken place in the contents of the said appendix. The overall effect of these changes on the consolidatable group’s networth, financial situation and results in 2003 with respect to the preceding year is described in the relevant notes to this annual report.
› The following changes have taken place in the corporate name of the entities included in the said appendix:
Former Name New Name
SEFIN, S.A. SEFIN AGENCIA DE SEGUROS, S.A.
FAZ AGENCIA DE SEGUROS, S.A. FINISTERRE AGENCIA CANARIA DE SEGUROS,
SOCIEDAD UNIPERSONAL S.A. SOCIEDAD UNIPERSONAL
MAPFRE ACONCAGUA CIA. DE SEGUROS, S.A. MAPFRE ARGENTINA SEGUROS, S.A.
MAPFRE ACONCAGUA ART, S.A. MAPFRE ARGENTINA ART, S.A.
MAPFRE ACONCAGUA VIDA
COMPAÑÍA DE SEGUROS S.A. MAPFRE ARGENTINA SEGUROS DE VIDA, S.A.
VERA CRUZ SEGURADORA, S.A. MAPFRE VERA CRUZ SEGURADORA, S.A.
VERA CRUZ CONSULTORÍA TÉCNICA MAPFRE VERA CRUZ CONSULTORÍA
E ADMINISTRAÇAO DE FONDOS S/C LTDA. ADMINISTRAÇAO DE FONDOS S/C LTDA VERA CRUZ VIDA E PREVIDENCIA, S.A MAPFRE VERA CRUZ VIDA E PREVIDENCIA, S.A.
› The following companies, which did not form part of the consolidation perimeter in the pre- ceding year, were fully consolidated in the present fiscal year:
a) Due to acquisition in the year:
- SERVIMEDIC BALEAR, S.L. (Spain) - MUSINI (Spain)
- MUSINI VIDA, S.A.DE SEGUROS Y REASEGUROS SOCIEDAD UNIPERSONAL (Spain), hereinafter “MUSINI VIDA”
- INTERBOLSA, S.A. (Spain) - SERVIFINANZAS, S.A. (Spain) - GESMUSINI S.G.I.I.C., S.A. (Spain) - GESMUSINI CARTERAS, S.A. (Spain) - INDUSTRIAL RE MUSINI, S.A. (Luxembourg)
- GENERAL SERVICES REINSURANCE LIMITED (Ireland) - NUOVI SERVIZI AUTO, S.P.A. (Italy)
- CANADA LIFE INSURANCE COMPANY (Puerto Rico)
- BRICKELL FINANCIAL SERVICES INC. (United States), trading under the name of ROAD AMÉRICA MOTOR CLUB (hereinafter “ROAD AMÉRICA”)
- MM REAL STATE, LLC (United States)
- MAPFRE RE COMPAÑÍA DE SERVICIOS GENERALES, S.A. (Peru) - MAPFRE MANDATOS Y SERVICIOS (Argentina)
b) Due to incorporation in the year:
- MAPFRE AGROPECUARIA, COMPAÑÍA INTERNACIONAL DE SEGUROS Y REASEGUROS S.A. (Spain)
c) Due to incorporation in the preceding year, with activities starting in 2003:
- CENTROS MÉDICOS ISLAS CANARIAS, S.A. (Spain)
› The following companies, incorporated in the year, were consolidated by the equity method: - MAPFRE ASISTENCIA ORO, S.A. (Spain)
- PUERTA DE ALCORCÓN 12, S.L. (Spain) - MULTISERVICAR CENTRO, S.A. (Spain) - MULTISERVICAR ASTURIAS, S.A. (Spain) - MULTISERVICAR ÁVILA, S.A. (Spain) - MULTISERVICAR M., S.A. (Spain)
› In 2003, the following companies ceased to be Group controlled companies or affiliates, due to the reasons indicated below:
a) Sale to third parties:
- AFORE TEPEYAC, S.A. (Mexico)
- SERVICIOS INTEGRALES DE AHORRO ENERGÉTICO (Spain) - SIEFORE TEPEYAC, S.A. (Mexico)
b) Winding-up:
- INMOBILIARIA Y RENTAS ALCÁNTARA 218, S.A. (Chile) - INVERSIONES ALCÁNTARA 200, S.A. (Chile)
c) Takeover by another Group company, by merger or winding-up with overall assignment of assets and liabilities:
- MAPFRE AUTOMÓVILES RIESGOS ESPECIALES, COMPAÑÍA DE SEGUROS Y REASEGUROS, S.A. (Spain), hereinafter “MARES”; taken over by MAPFRE MUTUALIDAD
- MAPFRE INSURANCE COMPANY OF AMERICA INC. (United States), taken over by MAPFRE COMPANY OF FLORIDA (United States)
The date of inclusion in the consolidation perimeter of MUSINI VIDA and MUSINI and their controlled companies was 1 October 2003; consequently, the consolidated profit and loss account only includes the transactions carried out by the said companies only from 1st Octo- ber until 31st December 2003.
The columns of adjustments to the opening balance appearing in the various tables of this report include the changes occurred as a result of the inclusion or exclusion of companies in the consolidated statements, changes in the consolidation method or procedure applied, and application of a different exchange rate for the translation of figures corresponding to over- seas subsidiaries.
Variations in the technical reserves recorded on the profit and loss account differ from those obtained by difference in the balance sheet balances of the present and previous fiscal year, as a result of changes occurred in the consolidation perimeter and of the application of a dif- ferent exchange rate for the translation of figures in the case of overseas subsidiaries.
e) Significant transactions between Group companies
Notes 6.18 and 6.19 of this report offer a breakdown of significant transactions between Group com- panies; information is also given in the specific notes on balance sheet items that may be affected.
f) Criteria for the imputation of revenues and expenses
Financial income and expenses imputable to the life and non life activities are those deriving from the assets assigned to each activity. The criteria followed for imputation to the different lines corresponding to the non life activity, of income and expenses the accounting registry of which does not have a specific line, are as follows:
› Other technical: pro rata to accrued premiums
› Investments: as a function of technical reserves in the different business lines
› Administration: as a function of the number of policies and the collection period for each one of them
› Claims: as a function of the handling and management of dossiers
› Acquisition: as a function of new production policies.
Income and expenses imputed to the technical account are those arising directly from insur- ance operations. Those assigned to the non technical account are extraordinary revenues and expenses and those unrelated to insurance operations, as well as those corresponding to non insurance companies.