Agrokor Financial Report For 2016

Agrokor d.d.
AGROKOR d.d.
SEPARATE FINANCIAL STATEMENTS FOR THE YEAR 2016, ANNUAL REPORT ON THE STATE
OF THE COMPANY AND THE INDEPENDENT
AUDITOR´S REPORT
Contents
Page
STATEMENT OF THE RESPONSIBILITY OF THE EXTRAORDINARY COMMISSIONER 2
INDEPENDENT AUDITOR´S REPORT 5
FINANCIAL STATEMENTS
Profit and loss account for the year 2016 9
Statement of total income for the year ended 31 December 2016 10
Statement of financial position as at 31 December 2016 11
Statement of changes in equity for the year 2016 12
Statement of cash flow for the year 2016 13
NOTES TO FINANCIAL STATEMENTS 14-57

Agrokor d.d,
Responsibility of the Extraordinary Commissioner for financiai statements
Pursuant to the Croatian Accounting Law in force, the Extraordinary Commissioner is responsible for
ensuring that financiai statements are prepared for each financial year in accordance with Accounting Law
(Officiai Gazette of the Republic of Croatia 78/15, 120/16), International Financiai Reporting Standards (IFRS)
as adopted by the European Union (EU) which give a true and fair view of the financiai position, operating
resu Its, changes in equity and cash flows of the Company for that period.
The Extraordinary Commissioner has a reasonable expectation that the Company has adequate resources to
continue in operational existence for the foreseeable future. For this reason, the Extraordinary
Commissioner continues to adopt the going concern basis in preparing the financiai statements.
In preparing those financiai statements, the responsibilities of the Extraordinary Commissioner include
ensuring that:
• suitable accounting policies are selected and then applied consistently;
• judgements and estimates are reasonable and prudent;
• applicable accounting standards are followed, subject to any material departures disclosed and explained
in the financiai statements; and
• the financiai statements are prepared on the going concern basis unless it is inappropriate to presume
that the Company will continue in business.
The Extraordinary Commissioner is responsible for keeping proper accounting records, which disclose with
reasonable accuracy at any time the financiai position, operating resu Its, changes in equity and cash flows of
the Company and must also ensure that the financiai statements comply with the Croatian Accounting Law
in force and International Financial Reporting Standards (IFRS). The Extraordinary Commissioner is also
responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.
The accompanying financiai statements were approved for issuance by the Extraordinary Commissioner on
90ctober2017
Ante Ramljak
Extraordinary Commissioner
~------
2
Independent Auditor’s Report
To the Extraordinary Commissioner of Agrokor d.d.:
Our Qualified Opinion

In our opinion, except for the effect of the matters described in point 5 and possible effects of the
matters described in points 1,2, 3 and 4 in the Basis for Qualified Opinion section of our report, the
separate financial statements present fairly, in all material respects, the financial position of
Agrokor d.d. (the “Company”) as at 31 December 2016, and its financial performance and its cash flows
for the year then ended in accordance with International Financial Reporting Standards as adopted by
European Union (“IFRS EU”).
What we have audited
The Company’s separate financial statements comprise:
 the profit and loss statement for the year ended 31 December 2016;
 the statement of other comprehensive income for the year ended 31 December 2016;
 the statement of financial position as at 31 December 2016;
 the statement of changes in equity for the year ended 31 December 2016;
 the cash flow statement for the year ended 31 December 2016; and
 the notes to the financial statements, which include of significant accounting policies and
other explanatory information.
Basis for Qualified Opinion
1. As described in Note 2.4.4 to the separate financial statements, the financial statements of previous
period have been restated for the effect of misstatements identified by Management. As further
indicated in Note 2.4.4, there are ongoing investigations by Management, its advisors and external
bodies in this regard, and consequently, pending the completion of these various investigations, we
are unable to satisfy ourselves that all prior errors have been identified and hence as to the
completeness, timing of recognition and accuracy of the amounts presented in Note 2.4.4.
2. As described in Note 15 to the separate financial statements, the Company entered into complex
repurchase agreements and transactions related to shares of its subsidiaries. There are currently
ongoing forensic investigations related to the beneficial direct and indirect ownership percentage
of the Company, which might influence ownership percentage and measurement of the investments
in subsidiaries recorded as at 31 December 2016 and prior periods. Consequently, we are unable to
satisfy ourselves as to the accuracy, existence and valuation of the investments in subsidiaries in the
separate statement of financial position.
PricewaterhouseCoopers d.o.o., Ulica kneza Ljudevita Posavskog 31, 10000 Zagreb, Croatia
T: +385 (1) 6328 888, F:+385 (1)6111 556, www.pwc.hr
Commercial Court in Zagreb, no. Tt-99/7257-2, Reg. No.: 080238978; Company ID No.: 81744835353; Founding capital: HRK 1,810,000.00, paid in full; Management Board: J. M. Gasparac, President; S.
Dusic, Member; T. Macasovic, Member; Giro-Account: Raiffeisenbank Austria d.d., Petrinjska 59, Zagreb, IBAN: HR8124840081105514875.
3. As described in Note 25 to the separate financial statements, the Company had to comply with
debt covenants related to its borrowings, the non compliance of which could result in certain
restrictions on the Company. Following the restatement of prior period financial statements,
Management has not yet completed the related legal analysis in order to assess the potential
impact on the classification of borrowings as at 31 December 2016 and prior periods. In the
absence of information to assess the compliance of the Company with debt covenant
restrictions, we are unable to satisfy ourselves as to the proper classification between current
and non-current borrowings in the financial periods presented. In addition, we were unable to
satisfy ourselves as to the accuracy and completeness of information about maturity of
financial liabilities that is required to be disclosed under IFRS 7, Financial Instruments:
Disclosures.
4. The Company has investments in subsidiaries of HRK 7,357,303 thousand. Management has
not carried out a complete review of all material investments to assess the recoverable amount,
and hence whether any further impairment loss should have been recognised. In the absence
of information to assess the recoverability of all the material investments in subsidiaries, we
were unable to satisfy ourselves as to the respective carrying amount and related impairment
disclosures by other audit procedures.
5. The financial statements do not fully comply with applicable disclosure requirements,
primarily in relation to effective tax reconciliation, fair value and related information for each
class of financial instruments, credit quality of each class of neither past due nor impaired,
past due but not impaired and impaired financial assets and disclosure of possible debt
covenant breaches, nature and purpose of reserves in equity, disclosure of gross cash flows
from borrowings and loan receivables and capital management. It was not practicable for us to
quantify the financial effects of these omissions.
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the
Audit of the Separate Financial Statements section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our qualified opinion.
Independence
We are independent of the Company in accordance with the International Ethics Standards Board for
Accountants’ Code of Ethics for Professional Accountants (IESBA Code). We have fulfilled our other
ethical responsibilities in accordance with the IESBA Code.
Material Uncertainty Relating to Going Concern

We draw attention to note 2.2 to the separate financial statements, which indicates that the Company
incurred a net loss of HRK 10,835,242 thousand for the year ended 31 December 2016 and, as of that
date, the Company’s liabilities significantly exceeded its total assets. As stated in notes 2.2 and 34,
these events, indicate that a material uncertainty exists that may cast a significant doubt on the
Company’s ability to continue as a going concern. Our opinion is not further modified in respect of this
matter.
Our audit approach
Materiality  Overall materiality for the separate financial statements as a whole:

HRK 100 million, which represents approximately 0.7% of total
assets.
Key audit matter  Impairment of loans, trade and other receivables
How we tailored our audit scope

We designed our audit by determining materiality and assessing the risks of material misstatement in
the separate financial statements. In particular, we considered where management made subjective
judgements; for example, in respect of significant accounting estimates that involved making
assumptions and considering future events that are inherently uncertain. We also addressed the risk of
management override of internal controls, including among other matters consideration of whether
there was evidence of bias that represented a risk of material misstatement due to fraud.
We tailored the scope of our audit in order to perform sufficient work to enable us to provide an
opinion on the separate financial statements as a whole, taking into account the accounting processes
and controls, and the industry in which the Company operates.
Materiality
The scope of our audit was influenced by our application of materiality. An audit is designed to obtain
reasonable assurance whether the separate financial statements are free from material misstatement.
Misstatements may arise due to fraud or error. They are considered material if individually or in
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of the separate financial statements.
Based on our professional judgement, we determined certain quantitative thresholds for materiality
for the separate financial statements as a whole as set out in the table below. These, together with
qualitative considerations, helped us to determine the scope of our audit and the nature, timing and
extent of our audit procedures and to evaluate the effect of misstatements both individually and in
aggregate on the separate financial statements as a whole.
Overall materiality for HRK 100 million
separate financial
statements as a whole
Approximately 0.7% of total assets.

How we determined it
Rationale for the We consider total assets to be the key metric for the Company,
materiality benchmark considering its activities as a holding company.
applied
Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the separate financial statements of the current period. These matters were addressed in
the context of our audit of the separate financial statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on these matters. In addition to the matters
described in the Basis for Qualified Opinion section, we have determined the matters described below
to be the key audit matters to be communicated in our report.
How our audit addressed the Key audit

Key audit matter
matter
Impairment of loans, trade and other We tested the detailed listings of loans, trade and
receivables other receivables substantively by examining a
sample of contracts, bank statements in respect to
Refer to note 18 (Short term investments) and subsequent payment receipts and invoices. As a
note 20 (Receivables). result, we determined that we could rely on these
Management performed an analysis of the reports for the purposes of our audit.
expected cash flows and collection of loans and Where we identified objective evidence of
receivables. As a result, part of the Company’s impairment, we examined the supporting
loans, trade and other receivables were documentation prepared by management to
determined to be impaired as at 31 December support the calculation of the impairment loss,
2016. challenged the assumptions and compared
estimates to external evidence, where available.
We focused on this area because Management
made subjective judgements over both the We considered the potential for impairment to be
timing of recognition of impairment based on impacted by events, which were not captured by
estimated future cash flows and the size of management’s estimation, and determined that no
such impairment. significant differences exist.
Based on the results of our procedures, other than
the restatement of prior period separate financial
statements for these assets as presented in Note 2,
we did not find any material exceptions.
Other information
Management is responsible for the other information. The other information comprises the Annual
Report of the Company, which includes the Management Report (but does not include the separate
financial statements and our independent auditor’s report thereon). The Management Report is
expected to be made available to us after the date of this independent auditor's report.
Our opinion on the separate financial statements does not cover the other information, including the
Management Report.
In connection with our audit of the separate financial statements, our responsibility is to read the other
information identified above when it becomes available and, in doing so, consider whether the other
information is materially inconsistent with the separate financial statements or our knowledge
obtained in the audit, or otherwise appears to be materially misstated.
With respect to the Management Report, we will also perform procedures required by the Accounting
Act in Croatia, when they become available to us. Those procedures include considering whether the
Management Report includes the disclosures required by Article 21 of the Accounting Act.
Responsibilities of management and those charged with governance for the

separate financial statements
Management is responsible for the preparation and fair presentation of the separate financial
statements in accordance with International Financial Reporting Standards as adopted by the
European Union, and for such internal control as management determines is necessary to enable the
preparation of separate financial statements that are free from material misstatement, whether due to
fraud or error.
In preparing the separate financial statements, management is responsible for assessing the
Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless management either intends to
liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company’s financial reporting
process.
Auditor’s responsibilities for the audit of the separate financial statements

Our objectives are to obtain reasonable assurance about whether the separate financial statements as a
whole are free from material misstatement, whether due to fraud or error, and to issue an independent
auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not
a guarantee that an audit conducted in accordance with ISAs will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these separate financial statements.
Profit and 1055 staternent for Agrokor d.d.
For the year ended 31 December 2016
Restated
2016 2015
Note 000 HRK 000 HRK
Revenue 3 398,298 620,666
Other income 4 1,105 1,368
399,403 622,034
Cost of energy and materials 5 (12,686) (8,028)

Cost of goods sold (8,298) (2,605)
Service costs 6 (236,783) (63,299)
Personnel expenses 7 (111,217) (119,624)
Depreciation and amortization (6,508) (8,629)
Impairment of long and short term assets 8 (7,888,208) (1,057,297)
Other expenses 9 (1,192,991) (94,396)
(9,456,691) (1,353,878)
Financiai income 10 1,175,108 1,348,600

Financiai expenses 11 (2,961,037) (1,920,020)
(1,785,929) (571,420)
Share in result of associates 16 7,975 (3,799)
Loss before taxation (10,835,242) (1,307,063)

Income tax
Net loss for the year (10,835,242) (1,307,063)
Approved on behalf of the Company on 9 October 2017 by:
rdinary Commissioner
9
Statement of other comprehensive income for Agrokor d.d.
For the year ended 31 December 2016
2016 2015
Note 000 HRK 000 HRK
NET LOSSFORTHEYEAR (10,835,242) (1,307,063)
Other comprehensive income
Other comprehensive income to be reclassified as profit or

1055 in future periods:
Net change in cash flow hedging 12 26,516
Net change on financial assets available for sale 12 (12,439) 10,034

Tax effect
(619)
Other comprehensive income to be reclassified as profit ar
1055 in future periods, net (12,439) 35,931
Other comprehensive income, net (12,439) 35,931
Total comprehensive income/ (1055) for the year, net (10,847,681) (1,271,132)
Approved on behalf of the Company on 9 October 2017 by:
Ante Ramljak
10
as at 31 December 2016
Restated Restated
31 December 31 December 31 December
2016 2015 2014
ASSETS Note 000 HRK 000 HRK 000 HRK
Non-current assets
Intangible assets 13 157 1,122 2,561
Property, plant and equipment 14 142,375 181,779 206,988
Investments in subsidiaries 15 7,357,303 10,114,100 5,990,514
Investments in associates 16 275,680 198,186 55,863
Financial assets 17 1,281,844 2,626,390 4,254,901
9,057,359 13,121,577 10,510,827
Current assets
Inventories 660 681 723
Loans and deposits 18 2,874,728 6,552,055 6,942,733
Trade and other receivables 20 231,966 1,746,436 1,172,267
Receivables based on bills of exchange
and recourse rights 19 3,222,752 3,960,237 4,158,415
Other current assets 21 25,105 60,991 46,548
Cash and cash equivalents 22 921 30,222 3,363
6,356,133 12,350,621 12,324,049
TOTAL ASSETS 15,413,492 25,472,198 22,834,876
LIABILITIES
Equity and reserves 23
Share capital 180,123 180,123 180,123
Capital reserves 2,154,747 2,154,747 2,154,747
Reserves from profit 9,007 9,007 9,007
Revaluation reserves (25,626) (13,187) (49,118)
Accumulated loss (15,815,516) (4,750,742) (3,286,865)
(13,497,265) (2,420,052) (992,106)
Long-term liabilities
Provisions 25 514 621 670
Loans and borrowings 26 18,977,749 16,356,254 14,864,066
Deferred tax liability 619 619 -
18,978,883 16,357,494 14,864,736
Short-term liabilities
Trade payables 27 97,682 153,054 145,250
Current portion of long-term loans 984,456 4,080,554 191,537
Short-term loans and borrowings 26 5,318,893 3,902,148 5,005,098
Liabilies for bills of exchange 3,064,071 3,083,166 3,349,816
Other short-term liabilities 28 466,772 315,834 270,545
9,931,874 11,534,756 8,962,246
TOTAL LIABILITIES AND EQUITY 15,413,492 25,472,198 22,834,876
11
Statement of changes in equity of Agrokor d.d. for the year ended 31 December 2016
Retained
Cash flow earnings/
Share Capital Treasury Other Reserves Revaluation hedge AFS accumulated
capital reserves shares reserves from profit reserves reserves reserves loss Total
000 HRK 000 HRK 000 HRK 000 HRK 000 HRK 000 HRK 000 HRK 000 HRK 000 HRK 000 HRK
As at 01 January 2015 180,123 2,154,747 - 1,289,073 9,007 78,064 (26,516) (22,602) 292,788 3,954,684
Restatement (Note 2.4) - - - (1,289,073) - (78,064) - - (3,579,653) (4,946,790)
As at 01 January 2015 (restated) 180,123 2,154,747 - - 9,007 - (26,516) (22,602) (3,286,865) (992,106)
Loss for the year - - - - - - - - (1,307,063) (1,307,063)
Other comprehensive income - - - - - - 26,516 9,415 - 35,931
Total comprehensive income - - - - - - 26,516 9,415 - 35,931
Merger - - - - - - - - (39,285) (39,285)
Dividend payment - - - - - - - - (112,903) (112,903)
Other - - - - - - - - (4,626) (4,626)
As at 31 December 2015
(restated) 180,123 2,154,747 - - 9,007 - - (13,187) (4,750,742) (2,420,052)*
Loss for the year - - - - - - - - (10,835,242) (10,835,242)
Other comprehensive income - - - - - - - (12,439) - (12,439)
Total comprehensive income - - - - - - - (12,439) (10,835,242) (10,847,681)
Treasury shares (Note 23) - - (229,532) - - - - - - (229,532)
As at 31 December 2016 180,123 2,154,747 (229,532) - 9,007 - - (25,626) (15,585,984) (13,497,265)
*Restatement impact totalled HRK 6,056,262 thousand at 31 December 2015
12
Cash flow statement of Agrokor d.d.
for the year ended 31 December 2016
Restated
2016 2015
000 HRK 000 HRK
CASH FLOW FROM OPERATING ACTIIVITIES
Result before taxation (10,835,242) (1,307,063)
Impairment of investments in subsidiaries (Note 8) 2,634,651 1,021,786
Impairment of intercompany receivables (Note 8) 2,376,366 -
Impairment of trade receivables, loans and deposits (Note 8) 2,877,191 35,511
Interest income (Note 10) (407,045) (570,462)
Interest expense (Note 11) 2,747,505 1,595,802
Other non-cash items – previously unrecognized costs 1,077,680 -
Dividend income (375,477) -
Net foreign exchange differences (94,776) 161,101
Profit on sale of share in subsidiaries (36,051) -
Depreciation and amortization 6,508 8,630
Company´s share in profit/loss of affiliated companies (Note 16) (7,975) 3,799
Loss from sale of tangible assets - 7,988
Change in provisions (107) -
Cash flow before adjustments for working capital changes (36,772) 957,092
Decrease in inventories 20 42
Increase/(decrease) of trade payables 104,628 (151,649)
(Increase) in other short-term assets - (14,443)
Increase/(decrease) in other short-term liabilities 231,206 (93,697)
CASH FLOW FROM OPERATING ACTIVITIES 299,082 697,345
Income tax paid - -
Interest paid (1,370,402) (1,456,862)
NET CASH FLOW FROM OPERATING ACTIVITIES (1,071,320) (759,517)
CASH FLOW FROM INVESTING ACTIVITIES
Acquisition of share in subsidiaries (1,803) (558,766)
Proceeds from sale of share in subsidiaries - 35,962
Payments for acquisition of intangible assets (7,997) (20)
Proceeds from sale of tangible assets 41,858 10,050
Payments for acquisition of shares and increase in share capital in
associates (45,010) (15,000)
Proceeds from sale of share in associates - 19,242
Net cash outflow for given loans and deposits (1,733,748) (3,748,353)
Payments for acquisition of AFS financial instruments (94,320) (532)
Interest received 32,891 39,647
Dividends received 20,000 436,629
NET CASH FLOW FROM INVESTING ACTIVITIES (1,788,129) (3,781,141)
CASH FLOW FROM FINANCIAL ACTIVITIES
Net cash inflow from short-term loans and borrowings 2,807,260 (384,477)
Cash inflow from long-term loans and borrowings 2,956,636 5,064,896
Repayment of long-term loans and borrowings (2,704,216) -
Dividends paid - (112,903)
Acquisition of treasury shares (229,532) -
NET CASH FLOW FROM FINANCIAL ACTIVITIES 2,830,148 4,567,516
TOTAL NET CASH FLOW (29,301) 26,859

Cash and cash equivalents at the beginning of the year 30,222 3,363
Cash and cash equivalents at the end of the year (Note 22) 921 30,222
(Decrease)/Increase in cash and cash equivalents (29,301) 26,859
13
Agrokor d.d.
Notes to financial statements for the year ended 31 December 2016
1. Corporate information
Agrokor d.d. (“the Company”) is a joint stock company which is incorporated in the Republic of Croatia.
The Company’s parent is Adria Group Holding B.V. Netherlands with a share of 95.52%; ultimate parent of
the Company is Agrokor projekti d.o.o. Zagreb, Croatia, while the ultimate controlling party at 31 December
2016 was Mr. Ivica Todorić. As of 10 April 2017 the ultimate controlling party of Agrokor d.d. is defined as
described in the Law for the Extraordinary Administration for Companies with Systemic Importance for the
Republic of Croatia ("the Law").
The Company’s registered main office is located at Trg Dražena Petrovića 3, Zagreb.
In 2016 the Company had on average 188 employees, while in 2015 it had on average 224 employees.
Principal activities
The Company operates as the holding company for Agrokor Group (“the Group”). The principal activities of
the Company and its subsidiaries (the Group) are consumer retail, manufacturing and distribution of food
products.
Supervisory Board
1. Todorić Ivan Chairman from 29.06.2016 until 10.04.2017

2. Puljić Ljerka Deputy Chairman from 18.02.2015 until 10.04.2017
3. Kuštrak Damir Member from 18.02.2015 until 10.04.2017
4. Lučić Tomislav Member from 18.02.2015 until 10.04.2017
5. Rukavina Tatjana Member from 18.02.2015 until 10.04.2017
Management Board
1. Todorić Ivica President from 26.05.2016 until 10.04.2017

2. Todorić Ante Deputy President from 15.05.2013 until 10.04.2017
3. Balent Hrvoje Member from 04.07.2012 until 10.04.2017
4. Canjuga Piruška Member from 17.06.2010 until 17.06.2015
5. Crnjac Ivan Member from 05.03.2013 until 10.04.2017
6. Galić Mislav Member from 15.05.2013 until 10.04.2017
7. Knez Darko Member from 01.01.2016 until 16.08.2016
8. Sertić Ivica Member from 01.03.2016 until 10.04.2017
Extraordinary Commissioner
Ante Ramljak, Extraordinary Commissioner since 10 April 2017, acting as Management and Supervisory
Board according to the Law for the Extraordinary Administration for Companies with Systemic Importance
for the Republic of Croatia (NN 32/17) (“the Law”).
14
Agrokor d.d.
2. Summary of significant accounting policies
2.1. Basis for the preparation of financial statements

The financial statements of the Company have been prepared in accordance with International Financial
Reporting Standards (IFRS) as adopted by the European Union.
The financial statements have been prepared on a historical cost basis, except for certain property, plant
and equipment - land, and those financial assets and liabilities which are stated at fair value, as described in
the following accounting policy notes.
The accounting policies have been consistently applied by the Company and are consistent with those of the
previous year, except as described in note 2.3.25 Changes in accounting policies due to new and amended
Standards.
The Company’s financial statements are presented in Croatian Kuna (HRK) which is the functional and
presentation currency of the Company. The effective exchange rate of the Croatian currency (expressed in
HRK) at 31 December 2016 was HRK 7.17 per United States Dollar (USD) (2015: HRK 6.99) and HRK 7.56 per
Euro (2015: HRK 7.64). All amounts disclosed in the financial statements are rounded to the nearest
thousand of HRK, except when otherwise indicated.
The Company has also prepared consolidated financial statements in accordance with IFRS as adopted by
EU. Consolidated financial statements were approved by the Extraordinary Commissioner on 9 October
2017. Users of these separate financial statements should read them together with the consolidated
financial statements of the Group for the year ended on 31 December 2016 in order to gain complete
information on the financial position, business results and changes in the financial position of the Group as a
whole.
2.2. Going Concern Assumption
At 31 December 2016 the Company’s current liabilities exceed current assets by HRK 3,575,736 thousand,
negative equity amounts to HRK 13,497,265 thousand and the Company incurred net loss of HRK 10,847,681
thousand for the year ended 31 December 2016. These facts along with the matters decribed below and
thosethe in Note 34 Events after the balance sheet date confirm the existence of significant uncertainty that
may cast a significant doubt on the Company’s ability to continue operating on the going concern basis and
that the Company it may be unable to realize all of its assets and discharge it’s liabilities in the normal course
of business.
Pursuant to the Law for the Extraordinary Administration for Companies with Systemic Importance for the
Republic of Croatia ("the Law"), on 7 April 2017, the Management Board of Agrokor d.d., Zagreb ("Agrokor")
has submitted a proposal to initiate the procedure for extraordinary administration at the Zagreb
Commercial Court.
The purpose of this Law is to protect the sustainability of business operations of companies with a systemic
importance for the Republic of Croatia while conducting business, financial and ownership restructuring with
the aim of preventing negative consequences on the overall economic, social and financial stability in the
Republic of Croatia that may arise from a sudden discontinuity in the operations of such companies.
The Commercial Court in Zagreb on 10 April 2017 (supplemented on 21 April 2017) issued a Decision to
initiate the procedure for extraordinary administration (St-1138/17) over Agrokor and some of its affiliated
or subsidiary companies. On the basis of this Decision, on 10 April 2017, the extraordinary commissioner
took over the management of Agrokor d.d. and control over the Agrokor companies included in the
extraordinary administration.
As defined in Article 7 of the Law, during the procedure of extraordinary administration it is not allowed to
institute proceedings for the liquidation of the debtor. Also, as defined in Article 41 of the Law during the
extraordinary administration procedure it is not permitted to institute litigation, enforcement,
administrative and insurance proceedings as well as non-judicial proceedings against Agrokor and its
subsidiaries and affiliates included in the extraordinary administration.
Within 12 months of the opening of the extraordinary administration procedure, with the possibility of
extension for 3 months, the extraordinary commissioner may,with the consent of the creditor council,
propose the settlement of liabilities. The Settlement process is defined by the Law while the outcome of the
settlement can not reasonably be estimated to the date of this report.
15
Agrokor d.d.
2.2 Going Concern Assumption (continued)

In accordance with the Law, the measure of extraordinary administration is implemented only when there is
a reasonable probability for the establishment of economic equilibrium and continuation of operations on
permanent basis. Otherwise, at any time during the proceedings of the extraordinary administration, the
court may, at the request of the extraordinary commissioner, with obtained consent of the creditor council,
decide to end the extraordinary administration procedure and to open bankruptcy proceedings if it is
established that circumstances have arisen as a consequence of which there is no longer a reasonable
chance of establishing an economic equilibrium and continuation of business on permanent basis.
According to our best knowledge, such circumstances have not materialized so far and according to the
information available by the date of this report, the Extraordinary Commisionner expects a successful
conclusion of the Settlement. Accordingly, the financial statements are prepared and presented on a going
concern basis.
2.3. Significant accounting policies

2.3.1. Revenue recognition
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company
and the revenue can be reliably measured. Revenue is measured at the fair value of the consideration
received, excluding discounts, rebates and sales taxes. The Company assesses its revenue arrangements
against specific criteria in order to determine if it is acting as a principal or agent. The Company has
concluded that it is acting as a principal in all of its revenue arrangements. The following recognition criteria
must also be met before the revenue is recognized:
The income from sales of products and merchandise are recognized if substantial risks and benefits of
ownership have been transferred to the buyer and if there is no considerable uncertainty regarding the
sales, the corresponding expenses or potential return of goods.
In relation to the rendering of services, revenue is recognized by reference to the stage of completion of the
transaction, when no significant uncertainties remain concerning the reliable estimation of consideration or
associated costs.
Interest income arising from the use by others of the Company’s resources is recognized when it is probable
that the economic benefits associated with the transaction will flow to the Company and the revenue can be
measured reliably.
Interest income is recognized as it accrues (taking into account the effective yield on the asset) unless
collection is in doubt.
Dividend income is recognized when the Company’s right to receive the payment is established, provided
that it is probable that the economic benefits will flow to the Company and the amount of income can be
measured reliably.
2.3.2. Classification of short-term against long-term

The Company presents assets and liabilities in the statement on financial position by classifying them into
long-term and short-term ones.
Assets are considered as short-term when:
 It is expected that they will be realized or in case the intention is to sell them or to spend them in a
normal operative cycle;
 They are primarily held for trading;
 it is expected that they will be realized within a period of 12 months after the reporting period, or
 or cash equivalent, except in case there is a restriction regarding use or disposal, or it can only be
used for settling liabilities in a period of at least 12 months after the end of the reporting period.
All other assets are considered as long-term.
A liability is considered as short-term when:
 It is expected that it will be settled within a normal operating cycle
 It is primarily held for trading,
 It becomes due within a period of 12 months after the reporting period, or
 There is no unconditional right to defer or payment for at least 12 months after the end of the
reporting period.
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Agrokor d.d.
All other liabilities are considered as long-term.

Deferred tax assets and deferred tax liabilities are classified as long-term assets and long-term liabilities.
2.3.3. Financial instruments

Financial assets and financial liabilities are recognised when the Company becomes a party to the
contractual provisions of the instruments.
Financial assets and financial liabilities are measured initially at fair value. On initial recognition, transaction
costs directly attributable to the acquisition or issue of a financial asset and a financial liability (other than
financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the
fair value of the financial asset or financial liability, as appropriate. Transaction costs directly associated with
an acquisition of a financial asset or a financial liability at fair value through profit or loss are recognised
immediately in profit or loss.
Financial assets
Financial assets are classified into one of the following portfolios “financial assets at fair value through profit
or loss” (FVTPL), “Investments hedd to maturity” (HTM), “Available-for-sale financial assets” (AFS) and
“Loans and receivables” (LR). The classification depends on the nature and purpose of the financial assets
and is determined at the time of initial recognition. Regular-way purchases and sales of financial assets are
recognised and derecognised on a trade date basis. Regular-way purchases or sales are those purchases or
sales of financial assets that require assets to be delivered within the period established by applicable
market regulation or convention.
Effective interest method (EIR)

The effective interest method is a method of calculating the amortised cost of a financial asset and of
allocating interest income over the relevant period. The effective interest rate is the rate that exactly
discounts estimated future cash receipts (including all fees on points paid or received that form an integral
part of the effective interest rate, transaction costs and other premiums or discounts) through the expected
life of the financial asset, or, where appropriate, a shorter period.
Income is recognised on an effective interest basis for debt instruments other than financial assets
designated as at FVTPL.
Subsequent measurement
The subsequent measurement of financial assets depends on their classification and is described as follows:
Financial assets at fair value through profit or loss

Financial assets are classified at fair value through profit or loss (FVTPL) when the financial asset is either
held for trading or it is designated at FVTPL.
Financial assets are classified as held for trading if they are acquired for the purpose of selling or
repurchasing in the near term. Derivatives, including separated embedded derivatives are also classified as
held for trading unless they are designated as effective hedging instruments.
Financial assets at fair value through profit or loss are carried in the statement of financial position at fair
value with net changes in fair value presented in the profit and loss statement.
Financial assets designated upon initial recognition at fair value through profit or loss are designated at their
initial recognition date and only if the respective criteria are satisfied. The Company has not designated any
financial assets at fair value through profit or loss.
Derivatives embedded in host contracts are accounted for as separate derivatives and recorded at fair value
if their economic characteristics and risks are not closely related to those of the host contracts and the host
contracts are not held for trading or designated at fair value through profit or loss. These embedded
derivatives are measured at fair value with changes in fair value recognized in profit or loss. Reassessment
only occurs if there is a change in the terms of the contract that significantly modifies the cash flows that
would otherwise be required
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Agrokor d.d.
2.3. Significant accounting policies (continued)
Available-for-sale financial investments

Available-for-sale financial investments include equity investments and debt securities. Equity investments
classified as available for sale are those that are neither classified as held for trading nor designated at fair
value through profit or loss. Debt securities in this category are those that are intended to be held for
indefinite period of time and that may be sold in response to needs for liquidity or in response to changes in
the market conditions.
After initial recognition, available-for-sale financial investments are subsequently measured at fair value
with unrealized gains or losses recognized as other comprehensive income and accumulated in the available-
for-sale reserve until the investment is derecognized or impaired, at which time the cumulative gain or loss
is reclassified to profit or loss. Interest earned whilst holding available-for-sale financial investments is
reported as interest income using EIR method. Available-for-sale financial investments in equity instruments
that do not have a quoted market price in an active market and whose fair value cannot be reliably
measured shall be measured at cost.
The Company evaluates whether the ability and intention to sell its available-for-sale financial assets in the
near term is still appropriate. When, in rare circumstances, the Company is unable to trade these financial
assets due to inactive markets and management’s intention to do so significantly changes in the foreseeable
future, the Company may elect to reclassify these financial assets. Reclassification to loans and receivables is
permitted when the financial assets meet the definition of loans and receivables and the Company has the
intent and ability to hold these assets for the foreseeable future or until maturity. Reclassification to the
held to maturity category is permitted only when the entity has the ability and intention to hold the financial
asset accordingly.
For a financial asset reclassified from the available-for-sale category, the fair value carrying amount at the
date of reclassification becomes its new amortized cost and any previous gain or loss on the asset that has
been recognized in equity is amortized to profit or loss over the remaining life of the investment using the
EIR. Any difference between the new amortized cost and the maturity amount is also amortized over the
remaining life of the asset using the EIR. If the asset is subsequently determined to be impaired, then the
amount recorded in equity is reclassified to the profit and loss statement.
Held-to-maturity investments
Non-derivative financial assets with fixed or determinable payments and fixed maturities are classified as
held to maturity when the Company has the positive intention and ability to hold them to maturity. After
initial measurement, held-to-maturity investments are measured at amortized costs using the EIR, less
impairment. Amortized cost is calculated by taking into account any discount or premium on acquisition and
fees or costs that are an integral part of the EIR. The EIR amortization is included as interest income in the
profit and loss statement. The losses arising from impairment are recognized in the profit and loss
statement.
Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not
quoted in an active market. After initial recognition, such financial assets are subsequently measured at
amortized cost using EIR method, less impairment. Amortized cost is calculated by taking into account any
discount or premium on acquisition and fees or costs that are an integral part of EIR. The EIR amortization is
included in interest income in the profit and loss statement. The losses arising from impairment are
recognized in the profit and loss statement.
Derecognition
Financial assets are derecognized when the rights on receiving cash flows from these assets have expired or
when the Company transferred the rights on receipt of cash flows from assets or when it had assumed a
qualifying pass-through obligation to pay received cash flows fully without significant delay to third party
and the Company has essentially transferred all risks and rewards of assets, or the Company has not
essentially transferred substantially all risks and benefits from assets, but has transferred control over the
assets.
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Agrokor d.d.
Impairment of financial assets

Financial assets, other than those at FVTPL, are assessed for indications of impairment at the end of each
reporting period.
The Company assesses, at each reporting date, whether there is objective evidence that a financial asset or a
group of financial assets is impaired. A financial asset or a group of financial assets is deemed to be impaired
if there is objective evidence of impairment as a result of one or more events that has occurred since the
initial recognition of the asset and that loss event has an impact on the estimated future cash flows of the
financial asset or the group of financial assets that can be reliably estimated.
For financial assets carried at amortized cost: if there is objective evidence that impairment has been
incurred, the amount of the loss is measured as the difference between the asset’s carrying amount and the
present value of estimated future cash flows. The present value of the estimated future cash flows is
discounted at the financial asset’s original EIR. The carrying value of the asset is reduced and loss is
recognized in profit or loss.
For available for sale financial instruments: when there is evidence of impairment, the cumulative loss,
measured as the difference between the acquisition cost /or amortized cost) and the current fair value less
any impairment loss on that investment previously recognized in profit and loss statement, is removed from
other comprehensive income and recognized in the profit and loss statement.
Financial liabilities and equity instruments
Classification as debt or equity

Debt and equity instruments issued by the Company are classified as either financial liabilities or as equity in
accordance with the substance of the contractual arrangements and the definitions of a financial liability and
an equity instrument.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of an entity after
deducting all of its liabilities. Equity instruments issued by the Company are recognised at the proceeds
received, net of direct issue costs. Repurchase of own equity instruments is recognised as a deduction
directly in equity. No gain or loss is recognised in profit or loss on the purchase, sale, issue or cancellation of
the Company's own equity instruments.
Financial liabilities
Financial liabilities are classified as either financial liabilities ‘at FVTPL’ or ‘other financial liabilities’.
Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial
liabilities designated upon initial recognition as at fair value through profit or loss.
Financial liabilities are classified as held for trading if they are acquired for the purpose of selling in the near
term. This category includes derivative financial instruments that are not designated as hedging instruments
in hedge relationship. Separate embedded derivatives are also classified as held for trading unless they are
designated as effective hedging instruments.
Gains and losses on liabilities held for trading are recognized in the profit and loss statement.
Financial liabilities designated upon initial recognition at fair value through profit or loss are designated at
the initial date of recognition and only if the respective criteria are satisfied. The Company has not
designated any financial liability as at fair value through profit or loss.
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Agrokor d.d.

Other financial liabilities
Other financial liabilities (including borrowings, trade and other payables) are measured initially at
amortised cost using the effective interest method.
The effective interest method is a method of calculating the amortised cost of a financial liability and of
allocating interest expense over the relevant period. The effective interest rate is the rate that exactly
discounts estimated future cash payments (including all fees on points paid or received that form an integral
part of the effective interest rate, transaction costs and other premiums or discounts) through the expected
life of the financial asset, or, where appropriate, a shorter period.
Financial guarantee contracts

A financial guarantee contract is a contract that requires the issuer to make specified payments to reimburse
the holder for a loss it incurs because a specified debtor fails to make payments when due in accordance
with the terms of a debt instrument.
The Company measures financial guarantee contracts initially at their fair values and subsequently, if they
are not designated as FVTPL, at the higher of:
 the amount of the obligation under the contract, as determined in accordance with IAS 37
Provisions, Contingent Liabilities and Contingent Assets; and
 the amount initially recognised less, where appropriate, cumulative amortisation recognised in
accordance with the revenue recognition policies.
Derecognition of financial liabilities

The Company derecognises financial liabilities when, and only when, the Company’s obligations are
discharged, cancelled or they expire. The difference between the carrying amount of the financial liability
derecognised and the consideration paid and payable is recognised in profit or loss.
Offsetting of financial instruments

Financial assets and financial liabilities are offset and the net amount is reported in the statement of
financial position if there is a currently enforceable legal right to offset the recognized amounts and there is
an intention to settle on a net basis, to realize the assets and settle the liabilities simultaneously.
2.3.4. Fair value measurement

The Company measures financial instruments and other financial assets (in case it is requested in provisions
from other standards) on each balance sheet date.
The fair values of assets and liabilities are determined using assumptions that market participants would
apply in setting a price for an asset or liability, assuming that they act in their best economic interest.
The fair value measurement of financial assets takes into account the possibility that a market participant
would benefit from the highest and best use of an asset or from the sale of the asset to another market
participant that would benefit from the asset's highest and best use.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient
data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing
the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are
categorized within the fair value hierarchy, described as follows, based on the lowest level input that is
significant to the fair value measurement as a whole:
 Level 1: Quoted (unadjusted) market prices in active markets for identical assets or liabilities
 Level 2: Valuation techniques for which the lowest level input that is significant to the fair value
measurement is directly or indirectly observable
 Level 3: Valuation techniques for which the lowest level input that is significant to the fair value
measurement is unobservable.
For assets and liabilities that are recognized in the financial statements on a recurring basis, the Company
determines whether transfers have occurred between levels in the hierarchy by re-assessing categorization
(based on the lowest level input that is significant to the fair value measurement as whole) at the end of
each reporting period.
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Agrokor d.d.
2.3.5. Investments in subsidiaries

In the separate financial statements, the Company carries investments in subsidiaries at cost less
impairment. Investments are tested annually for impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable. Investments in subsidiaries that suffered an
impairment in previous periods are reviewed for possible reversal of the impairment at each reporting date.
Subsidiaries are all entities over which the Company has the power to govern the financial and operating
policies generally accompanying a shareholding of more than one half of the voting rights. The existence and
effect of potential voting rights that are currently exercisable or convertible are considered when assessing
whether the Company controls another entity.
2.3.6. Investments in Associates and Joint Ventures

An associate is an entity over which the Company has significant influence. Significant influence is the power
to participate in the financial and operating policy decisions of the investee, but is not control or joint
control over those policies. In practice, associates are entities in which the Company owns between 20% and
50% of voting rights, these are the entities that are significantly influenced but not controlled by the
Company.
A joint venture is a type of joint arrangement whereby the parties that have joint control of the arrangement
have rights to the net assets of the joint venture. Joint control is the contractually agreed sharing of control
of an arrangement, which exists only when decisions about the relevant activities require unanimous
consent of the parties sharing control.
The considerations made in determining significant influence or joint control is similar to those necessary to
determine control over subsidiaries.
The Company’s investments in associates are accounted for using the equity method.
Under the equity method, the investment in an associate or a joint venture is initially recognized at cost. The
carrying amount of the investment is adjusted to recognize changes in the Company’s share of the net assets
of the associate or joint venture since the acquisition date. According to the equity method, Company’s
share in gains and losses of associated companies and joint ventures are recognized through the Statement
of comprehensive income, from the date the significant influence commences until the date that the
significant influence ceases.
Goodwill relating to the associate or joint venture is included in the carrying amount of the investment and
is not tested for impairment individually.
The statement of profit or loss reflects the Company’s share of the results of operations of the associate or
joint venture. Any change in OCI of those investees is presented as part of the Company’s OCI. In addition,
when there has been a change recognized directly in equity of the associate or joint venture, the Comany
recognizes its share of any changes, when applicable, in the statement of changes in equity. Unrealized gains
and losses resulting from transactions between the Company and the associate or joint venture are
eliminated to the extent of the interest in the associate or joint venture.
The financial statements of the associate or joint venture are prepared for the same reporting period as the
Company. When necessary, adjustments are made to bring the accounting policies in line with those of the
Company.
After application of the equity method, the Company determines whether it is necessary to recognize an
impairment loss on its investment in its associate or joint venture. At each reporting date, the Group
determines whether there is objective evidence that the investment in the associate or joint venture is
impaired. If there is such evidence, the Company calculates the amount of impairment as the difference
between the recoverable amount of the associate or joint venture and its carrying value, and then
recognizes the loss in the statement of profit or loss.
Upon loss of significant influence over the associate or joint control over the joint venture, the Company
measures and recognizes any retained investment at its fair value. Any difference between the carrying
amount of the associate or joint venture upon loss of significant influence or joint control and fair value of
the retained investment as well as proceeds from disposal is recognized in profit or loss.
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Agrokor d.d.

2.3.7. Intangible assets
Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible
assets acquired in a business combination is its fair value as at the date of acquisition. Following initial
recognition, intangible assets are carried at cost less any accumulated amortization and any accumulated
impairment losses. Internally generated intangible assets, excluding capitalized development costs, are not
capitalized and expenditure is reflected in the profit and loss statement in the year in which the expenditure
is incurred. The useful lives of intangible assets are assessed as either finite or indefinite.
Intangible assets with finite useful lives are amortized over the useful economic life and assessed for
impairment whenever there is an indication that the intangible asset may be impaired, as described in the
accounting policy Impairment of assets. Intangible assets with finite useful lives are amortized on a straight-
line basis over their expected useful lives, which do not exceed ten years. The amortization period and the
amortization method for an intangible asset with a finite useful life are reviewed at least at each financial
year-end. Changes in the expected useful life or pattern of consumption of future economic benefits
embodied in the asset is accounted for by changing the amortization period or method, as appropriate, and
are treated as changes in accounting estimates.
Intangible assets with indefinite useful lives are not amortized, but are tested for impairment annually,
either individually or at the cash generating unit level. The assessment of indefinite useful life is reviewed
annually to determine whether the indefinite life continues to be supportable. If not, the change in useful
life from indefinite to finite is made on a prospective basis.
Gains or losses arising from derecognition of intangible assets are measured as the difference between the
net disposal proceeds and the carrying amount of the asset and are recognized in the profit and loss
statement when the asset is derecognized.
2.3.8. Property, plant and equipment

Property, plant and equipment are carried at cost less any accumulated amortization and any accumulated
impairment losses. Revaluation relates to the land and is based on the estimation of an independent
valuator. Appraisals are performed frequently enough in order to secure that current value of the revaluated
assets does not significantly differ from its fair value.
Appraisals were performed based on comparable market prices. When an asset is revalued, any increase in
the carrying value is credited to a revaluation surplus within equity (through other comprehensive income),
net of deferred taxation, if applicable.
The relevant portion of the revaluation surplus realised in respect of a previous valuation is released from
the asset valuation surplus directly to retained earnings upon the disposal of the revalued asset.
Items of property, plant and equipment that are retired or otherwise disposed of are eliminated from the
statement of financial position, along with the corresponding accumulated depreciation. Any gain or loss
arising from derecognizing of assets (calculated as the difference between net sales receipts and the carrying
value of the asset at the time of disposal) is taken to the profit and loss statement in the year of
derecognition.
When significant parts of buildings, plant and equipment are required to be replaced at intervals, the
Company amortizes them separately based on their specific useful lives. Also, when there are significant
overhauls, their costs are recognized as current value of buildings, plant and equipment, as replacement in
case that the conditions for recognition are met. All other costs relating to repairing and maintenance are
recognized in the profit and loss statement at the time when they occur.
Depreciation is recorded by a charge to income computed on a straight-line basis over the estimated useful
life of the asset, as follows:
Buildings up to 20 years
Plant and Equipment 2 to 5 years
Other fixed assets 5 to 20 years
The useful life, depreciation method and residual values are reviewed at each financial year-end and if
expectations differ from previous estimates, any changes are accounted for as a change in an accounting
estimate.
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Agrokor d.d.

2.3.9. Impairment of assets
The Company assesses at each financial year-end whether there is an indication that an asset may be
impaired. If any such indication exists, or when annual impairment testing for an asset is required, the
Company makes an estimate of the asset’s recoverable amount.
The recoverable amount is estimated as the higher of an assets or cash-generating unit’s fair value less costs
to sell and value in use. The fair value less costs to sell is the amount obtainable from the sale of an asset in
an arm’s length transaction less the costs of disposal while value in use is the present value of estimated
future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of its
useful life. Recoverable amounts are estimated for individual assets or, if this is not possible, for the cash-
generating unit to which the asset belongs. Cash-generating units are primarily identified at entity level.
Where carrying values exceed this estimated recoverable amount, the assets are written down to their
recoverable value.
2.3.10. Investment property

Investment property, principally comprising holiday residence and land, is held for long-term rental yields or
appreciation and is not occupied by the Company. Investment property is treated as a long-term investment
unless it is intended to be sold in the next year and a buyer has been identified, in which case it is classified
within current assets.
Investment property is carried at historical cost less accumulated depreciation and provision for impairment,
where required. Depreciation for buildings is calculated using the straight-line method to allocate cost over
estimated useful life (up to 20 years).
Subsequent costs are capitalised only when it is probable that future economic benefits associated with it
will flow to the Company and the cost can be measured reliably. All other repairs and maintenance costs are
expensed when incurred. If an investment property becomes owner-occupied, it is reclassified to property,
plant and equipment, and its carrying amount at the date of reclassification becomes its deemed cost to be
subsequently depreciated.
2.3.11. Leases
The determination of whether an arrangement is, or contains, a lease is based on the substance of the
arrangement at inception date; whether fulfillment of the arrangement is dependent on use of a specific
asset or the arrangement conveys a right to use the asset.
Company as a lessee
Finance leases, which effectively transfer to the Company substantially all the risk and rewards incidental to
ownership of the leased item, are capitalized at the lower of the fair value of the leased property or present
value of the minimum lease payments at the commencement date of the lease term and disclosed as leased
property, plant and equipment. Lease payments are apportioned between the finance charges and
reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the
liability. Finance charges are recognized in finance costs in the profit and loss statement.
Capitalized leased assets are depreciated over the shorter of lease term and its useful life. Leases where the
lessor effectively retains substantially all the risks and rewards of ownership of the leased item are classified
as operating leases. Operating lease payments are recognized as an expense in the profit and loss statement
on a straight-line basis over the lease term.
The accounting treatment of a sale and leaseback transaction depends upon the type of lease involved. If a
sale and leaseback transaction results in a finance lease, any excess of sales proceeds over the carrying
amount is deferred and amortized over the lease term. If a sale and leaseback transaction results in an
operating lease, and the transaction is established at fair value, any profit or loss is recognized immediately.
The Company as a lessor

Leases where the Company does not transfer substantially all the risks and rewards of ownership of the
asset are classified as operating leases. Initial direct costs incurred in negotiating an operating lease are
added to the carrying amount of the leased asset and recognized over the lease term on the same basis as
rental income. Contingent rents are recognized as revenue in the period in which they are earned.
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Agrokor d.d.

2.3.12. Non-current assets held for sale
Non-current assets and disposal groups classified as held for sale are measured at the lower of carrying
amount and fair value less costs to sell. Non-current assets and disposal groups are classified as held for sale
if their carrying amounts will be recovered principally through a sale transaction rather than through
continuing use. This condition is regarded as met only when the sale is highly probable and the asset or
disposal group is available for immediate sale in its present condition. Management must be committed to
the sale, which should be expected to qualify for recognition as a completed sale within one year from the
date of classification.
In the profit and loss statement of the reporting period, and of the comparable period of the previous year,
income and expenses from discontinued operations are reported separatly from income and expenses from
continuing activities, down to the level of profit after taxes, even when the Company retains a non-
controlling interest in the subsidiary after the sale. The resulting profit or loss (after taxes) is reported
separately in the profit and loss statement.
Property, plant and equipment and intangible assets once classified as held for sale are not depreciated or
amortized.
2.3.13. Inventories
Inventories are measured at the lower of cost and net realizable value.
Costs incurred in bringing each product to its present location and condition is accounted for as follows:
 Raw materials – purchase cost on a weighted average basis.
 Finished products and work in progress are recorded in the value which comprises the expenses of
direct materials and work and the corresponding part of general production expenses based on the
regular production capacity.
 Merchandise is recognized at the lower of cost or net realizable value.
Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of
completion and the estimated costs necessary to make the sale.
2.3.14. Trade receivables

Trade receivables, which generally have 30-90 days terms are recognized and carried at original invoice
amount less an allowance for any uncollectible amounts. An estimate for doubtful debts is made when
collection of the full amount is no longer probable. Bad debts are written off when identified.
2.3.15. Cash and cash equivalents

Cash and cash equivalents are defined as cash on hand, balances with banks, demand deposits, bank
deposits with contractual maturity of less than 3 months.
2.3.16. Taxation
Corporate taxation is based on the accounting profit for the year adjusted for permanent and temporary
differences between taxable and accounting income. Corporate taxation is provided for in accordance with
Croatian tax regulations. Companies’ income tax returns are subject to examination by the Tax Authorities.
Since the application of tax laws and regulations to several types of transactions is susceptible to varying
interpretations, amounts reported in the financial statements could be changed at a later date upon final
determination by the Tax Authorities.
Deferred income tax is calculated, using the liability method, on all temporary differences at the reporting
date due to differences in treatment of certain items for taxation and for accounting purposes within these
financial statements. Deferred tax assets and liabilities are measured using the tax rates expected to apply
to taxable income in the years in which those temporary differences are expected to be recovered or
settled.
Deferred tax assets are recognized when it is probable that sufficient taxable profits will be available against
which the deferred tax assets can be utilized. At each reporting date, the Company re-assesses unrecognized
deferred tax assets and the appropriateness of carrying amount of the tax assets.
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Agrokor d.d.
2.3.17. Transactions in foreign currencies

Financial statements of the Company are presented in the currency of the primary economic environment in
which the Company operates (in its functional currency) which is Criatian Kuna (HRK).
Transactions and balances:
Transactions in foreign currencies are initially recognised at the exchange rates that are valid on the day the
transaction is performed.
Monetary assets and liabilities in a foreign currency are translated into the functionalfuncional currency
using the reporting period closing exchange rate. Non-monetary items that are measured in terms of
historical cost in a foreign currency are translated using the exchange rates at the dates of the initial
transactions. Non-monetary items measured at fair value in a foreign currency are recalculated using the
exchange rates at the date when the fair value is determined.
Exchange rate gains and losses from transactions in foreign currency and from translation of monetary
assets and liabilities are recognized in the profit and loss statement in the period in which they occur.
2.3.18. Treasury shares

Where the Company purchases its equity share capital (treasury shares), the consideration paid, including
any directly attributable incremental costs (net of income taxes) is deducted from equity attributable to the
Company’s equity holders until the shares are cancelled or reissued. Where such shares are subsequently
reissued, any consideration received, net of any directly attributable incremental transaction costs and the
related income tax effects, is included in equity attributable to the Company’s equity holders.
2.3.19. Borrowing costs

Borrowing costs directly attributable to the acquisition, construction and production of an asset that
necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part
of the cost of the respective assets. All other borrowing costs are expensed in the period they occur.
Borrowing costs consist of interest and related transaction costs aprtised using the effective interest
method.
2.3.20. Pensions and employee benefits

The Company, in the normal course of business, makes fixed contributions into the State mandatory pension
funds on behalf of its employees. The Company does not operate any other pension scheme or post
retirement benefit plan, and consequently, has no legal or constructive obligation to make further
contributions if the funds do not hold sufficient assets to pay all employee benefits relating to employee
service in the current and prior periods.
The Company makes payments to employees that include one-off retirement and jubilee benefits. The
obligation and costs of these benefits are determined using a projected unit credit method. The projected
unit credit method considers each period of service as giving rise to an additional unit of benefit entitlement
and measures each unit separately to build up the final obligation.
Past service costs are recognized immediately in profit or loss. Gains or losses on the curtailment or
settlement of pension benefits are recognized when the curtailment or settlement occurs. The pension
obligation is measured at the present value of estimated future cash flows using a discount rate that is
similar to the interest rate on government bonds where the currency and terms of the government bonds
are consistent with the currency and estimated terms of the defined benefit obligation.
25
Agrokor d.d.
2.3.21. Provisions
Provisions are recognized when the Company has a present (legal or constructive) obligation as a result of
past events, it is probable that an outflow of resources embodying economic benefits will be required to
settle the obligation, and a reliable estimate of the amount of the obligation can be made.
Provisions are reviewed at each reporting date and adjusted to reflect the current best estimate. Where the
effect of discounting is material, the amount of the provision is the present value of the expenditures
expected to be required to settle the obligation, determined using the estimated risk free interest rate as
the discount rate. Where discounting is used, the reversal of such discounting in each year is recognized as a
financial expense and the carrying amount of the provision increases in each year to reflect the passage of
time.
Provisions for restructuring costs are recognized when the Company has a detailed formal plan for the
restructuring that has been communicated to parties concerned.
When the Company expects that part or all of the provision will be reimbursed, for example, under an
insurance contract, such collection is recognized as a separate asset, but only when the payment is fully
secure. Costs associated with the provision are shown in the profit and loss statement as a net amount less
all collection charges.
2.3.22. Contingencies
Contingent liabilities are not recognized in the financial statements. They are disclosed unless the possibility
of an outflow of resources embodying economic benefits is remote.
A contingent asset is not recognized in the financial statements but disclosed when an inflow of economic
benefits is probable.
2.3.23. Subsequent events

Post year-end events that provide additional information about a Company’s position at the reporting date
(adjusting events) are reflected in the financial statements. Post year-end events that are not adjusting
events are disclosed in the notes when material.
2.3.24. Critical accounting judgements and estimates

The preparation of financial statements in accordance with IFRS requires the use of judgements and
estimates that affect the amounts reported in the financial statements and notes thereto. Although these
estimates are based on management’s best knowledge of current events and actions, actual results may
differ from those estimates.
Key assumptions that relate to future events, as well as other sources of uncertainty at the date of
preparation of these financial statements that may cause the risk of significant adjustments to recorded
amounts of assets and liabilities in the following financial year are discussed below:
a) Impairment of investments in subsidiaries

As at 31 December 2016 the Company performed a recoverability assessment of investments in
subsidiaries. As a result of this analysis, in 2016 the Company recognised impairment of
investments in subsidiaries of HRK 2,634,651 thousand mainly relating to investment in Konzum
d.d. of HRK 707,355 thousand and Konzum Sarajevo of HRK 1,865,951 thousand. Taking into
account negative equity of both companies as well as the need for significant restructuring for
those entities to continue operating on the going concern basis the Company has concluded that
investments in both entities as at 31 December 2016 should be fully impaired.
Out of the remaining amount of investments in subsidiaries the Company has identified impairment
indicators for HRK 3,092,824 thousand, however due to the current restructuring process and the
fact that no reliable future plans were available until the date of these financial statements the
Company did not perform impairment tests for those investments and at 31 December 2016 they
are carried at cost.
26
Agrokor d.d.
2.3.24. Critical accounting judgements and estimates (continued)
b) Impairment of loan receivables, deposits and trade receivables (external)

As at 31 December 2016 the Company performed a recoverability analysis of the outstanding
balance of loan receivables, deposits and trade receivables (external) and as a result of that analysis
the Company recognised impairment relating to those assets of HRK 2,877,191 thousand in 2016.
The recoverability assessment was based on the analysis of overdue amounts, counterparty
payment history and financial viability as well as available collaterals and the combined results were
considered as an objective evidence of impairment.
c) Impairment of receivables from Agrokor group companies (trade receivables and loans)
As at 31 December 2016 the Company performed a recoverability analysis of the outstanding
balance of trade receivables and loan receivables from Agrokor group companies and as a result of
that analysis the Company recognised impairment of those assets of HRK 2,376,366 thousand in
2016. Due to the fact that collection of intercompany receivables that were still outstanding at 10
April 2017 (start of Extraordinary Administration) is subject to the settlement process the Company
assessed that there is an objective evidence of impairment. Recoverability assessment was
determined by taking into account available information on the financial position of the Group,
external factors and other practices. If the impairment estimate was higher/ lower by 10% the loss
for the year would be higher/ lower by HRK 475,273 thousand.
2.3.25. Changes in accounting policies due to new and amended Standards
During the year, the Company adopted the following new and amended IFRS and interpretations which have
been adopted by the EU. When assessing whether the application of standards or interpretations has an
impact on the financial statements or the results of the Company, their impact is described below:
(a) New and amended standards - applicable from 1 January 2016
The following standards and interpretations are applicable for the first time for financial reporting periods
beginning on or after 1 January 2016:
Equity methods in Separate Financial Statements - Amendments to IAS 27

The International Accounting Standards Board has amended IAS 27 Separate Financial Statements that
allows entities to use equity method when reporting investments in subsidiaries, joint ventures and
associates in unconsolidated financial statements.
IAS 27 previously allowed entities to present their investments in subsidiaries, joint ventures and associates
at their cost or as financial assets in the case of IAS 39 in the unconsolidated financial statements. With the
amendments the equity method is introduced as the third option. A different method can be chosen for
each category of investment (subsidiaries, joint ventures and associates). Entities wishing to start applying a
equity method must do so retrospectively.
The Company elected accounting policy to measure investments in subsidiaries at cost and to measure
investments in associates and in joint ventures using the equity method of accounting.
The other amended standards effective for 2016 did not have material impact for the entity.
27
Agrokor d.d.
Standards, amendments and interpretations of existing standards that are not yet effective and which the
Company has not early adopted
Disclosure Initiative - Amendments to IAS 7

The amendments require disclosures that enable users of financial statements to evaluate changes in
liabilities arising from financing activities, including both changes arising from cash flow and non-cash
changes.
The amendments are effective for annual periods beginning on or after 1 January 2017, with early adoption
permitted.
It is not expected that this new initiative will have a significant effect on the financial statements of the
Company, except for the new disclosures.
IFRS 9 Financial Instruments

In July 2014, the International Accounting Standards Board issued the final version of IFRS 9 Financial
Instruments. IFRS 9 is effective for annual periods beginning on or after 1 January 2018, with early adoption
permitted. The Company currently plans to apply IFRS 9 initially on 1 January 2018. It is not expected that
this standard will have a significant effect on the financial statements of the Company except for additional
impairment provisions to be recognized under expected loss rather than current incurred loss model.
The Company intends to adopt a new standard on its effective date. The Company is in the process of
assessment of the impact of the application of this new standard on its financial statements. The Company
expects to apply a simplified approach and present expected life time impairment losses for all trade
receivables.
IFRS 15 Revenue from Contracts with Customers

IFRS 15 establishes a comprehensive framework for determining whether, how much and when revenue is
recognised. It replaces existing revenue recognition guidance, including IAS 18 Revenue, IAS 11 Construction
Contracts, IFRIC 13 Customer Loyalty Programmes and IFRIC 15 Agreements for construction of real estate.
IFRS 15 is effective for annual periods beginning on or after 1 January 2018, with early adoption permitted.
Taking into account that the Company operates as the holding company and its main revenue source are
services recognized on percentage of completion basis and has no other significant activities it is not
expected that application of this new standard will have significant impact on the financial statements of the
Company. However the Company needs to perform a comprehensive implementation project to confirm
there are no other material effects.
Entities will be able to choose between full retroactive application or prospective application with additional
disclosures.
IFRS 16 Leases
IFRS 16 introduces a single, on-balance lease sheet accounting model for lessees. A lessee recognises a right-
of-use asset representing its right to use the underlying asset and a lease liability representing its obligation
to make lease payments. There are optional exemptions for short-term leases and leases of low value items.
Lessor accounting remains similar to the current standard – i.e. lessors continue to classify leases as finance
or operating leases.
The standard is effective for annual periods beginning on or after 1 January 2019. Early adoption is
permitted for entities that apply IFRS 15 Revenue from Contracts with Customers at or before the date of
initial application of IFRS 16.
Assets leased by the Company mainly relate to cars and therefore it is not expected that application of this
standard will have significant impact on the financial statements of the Company. However the Company
needs to perform a comprehensive implementation project to confirm there are no other material effects.
The other new standards and amendments published by the IASB and IFRS IC are not expected to have a
material impact on the Company.
28
Agrokor d.d.
2.4. Restatement of prior period financial statements

Financial information as of 1 January 2015 and as of 31 December 2015 and for the period then ended have been restated for correction of the errors, which are identified as
follows:
Impact of adjusmtents on equity (increase/ (decrease)) as at 31 December 2015

In HRK 000
Note 2.4.1 Note 2.4.2 Note 2.4.3 Note 2.4.4 Note 2.4.5 Note 2.4.6 Note 2.4.7 Note 2.4.8 Note 2.4.9 Note 2.4.10 Note 2.4.11 Note 2.4.12
Reclassification Reclassification of
Reclassification of borrowings loans, deposits and
Not disclosed of borrowing from Trade interest receivables Impairment
Reclassification Measurement balances in the Reclassificatio from Other payables and from third party of loans, Receivables and Reclassification
of investments of investments Impairment of previous n of deposits reserves to Other liabilities receivables to deposits and liabilities for of liabilities for
Total impact of in subsidiaries in subsidiaries - investments in financial from cash Loans and to Loans and intercompany trade BoEs and BoE from trade Cut off
ASSETS adjustments and associates equity method subsidiaries statements equivalents borrowings borrowings receivables receivables recourse rights payables error
Non-current assets
Investments in subsidiaries (3.377.717) 1.251.205 (3.504.204) (1.124.718) - - - - - - - - -
Investments in associates 30.599 30.599 - - - - - - - - - - -
Available for sale investments (1.211.624) (1.252.771) - - 41.147 - - - - - - - -
Long term loans and deposits 1.292.560 - - - 885.299 461.213 - - (7.800) (46.152) - - -
(3.266.182) 29.033 (3.504.204) (1.124.718) 926.446 461.213 - - (7.800) (46.152) - - -
Current assets
Short-term loans – Agrokor group 1.015.835 - - - 607.409 326.999 - - 81.427 - - - -
Short-term loans and deposits 429.564 - - - 64.290 1.290.290 - - (47.945) - (877.071) - -
Other short term investments (29.033) (29.033) - - - - - - - - - - -
Trade and other receivables - receivables form
the owner 1.039.223 - - - 1.039.223 - - - - - - - -
Trade and other receivables (48.075) - - - 17.547 - - - (25.682) (39.940) - - -
Receivables based on bills of exchange and
recourse rights 3.960.237 - - - - - - - - - 3.960.237 - -
Cash and cash equivalents (2.078.502) - - - - (2.078.502) - - - - - - -
4.289.249 (29.033) - - 1.728.469 (461.213) - - 7.800 (39.940) 3.083.166 - -
TOTAL ASSETS 1.023.067 - (3.504.204) (1.124.718) 2.654.915 - - - - (86.092) 3.083.166 - -
LIABILITIES
Loans and borrowings 2.337.431 - - - 1.048.358 - 1.289.073 - - - - - -
2.337.431 - - - 1.048.358 - 1.289.073 - - - - - -
Trade payables (631.479) - - - - - - (77.729) - - - (553.750) -
Short-term loans and borrowings 2.290.536 - - - 1.606.557 - - 130.229 - - - 553.750 -
Liabilies for bills of exchange recourse rights 3.083.166 - - - - - - - - - 3.083.166 - -
Other short-term liabilities (325) - - - - - - (52.500) - - - - 52.175
4.741.898 - - - 1.606.557 - - - - - 3.083.166 - 52.175
TOTAL LIABILITIES 7.079.329 - - - 2.654.915 - 1.289.073 - - - 3.083.166 - 52.175
IMPACT ON NET EQUITY (6.056.262) - (3.504.204) (1.124.718) - - (1.289.073) - - (86.092) - - (52.175)
29
Agrokor d.d.
2.4. Restatement of prior period financial statements (continued)
Impact of adjusmtents on equity (increase/ (decrease)) as at 1 January 2015

In HRK 000
Note 2.4.1 Note 2.4.2 Note 2.4.3 Note 2.4.4 Note 2.4.5 Note 2.4.6 Note 2.4.7 Note 2.4.8
Reclassification of Note 2.4.9 Note 2.4.10 Note 2.4.11
Reclassification Reclassification of loans, deposits and
Not disclosed of borrowing borrowings from interest receivables Impairment
Reclassification Measurement balances in Reclassificatio from Other Trade payables from third party of loans, Receivables and Reclassification
of investments of investments Impairment of the previous n of deposits reserves to and Other receivables to deposits and liabilities for of liabilities for
Total impact of in subsidiaries in subsidiaries - investments in financial from cash Loans and liabilities to Loans intercompany trade BoEs and BoE from trade
ASSETS adjustments and associates equity method associates statements equivalents borrowings and borrowings receivables receivables recourse rights payables
Non-current assets
Investments in subsidiaries (3.475.171) 29.033 (3.504.204) - - - - - - - - -
Investments in associates (102.932) - - (102.932) - - - - - - - -
Available for sale investments - - - - - - - - - - - -
Long term loans and deposits 405.494 - - - - 460.878 - - (55.384) - - -
(3.172.609) 29.033 (3.504.204) (102.932) - 460.878 - - (55.384) - - -
Current assets
Short-term loans – Agrokor group 860.560 - - - 701.026 16.346 - - 143.188 - - -
Short-term loans and deposits 702.724 - - - - 1.627.377 - - (69.902) (46.152) (808.599) -
Other short term investments (29.033) (29.033) - - - - - - - - - -
Trade and other receivables - receivables form
the owner 697.100 - - - 697.100 - - - - - - -
Trade and other receivables (22.331) - - - - - - - (17.902) (4.429) - -
Receivables based on bills of exchange and
recourse rights 4.158.415 - - - - - - - - - 4.158.415 -
Cash and cash equivalents (2.104.601) - - - - (2.104.601) - - - - - -
4.262.834 (29.033) - - 1.398.126 (460.878) - - 55.384 (50.581) 3.349.816 -
TOTAL ASSETS 1.090.225 - (3.504.204) (102.932) 1.398.126 - - - - (50.581) 3.349.816 -
LIABILITIES
Loans and borrowings 191.537 - - - 191.537 - - - - - - -
191.537 - - - 191.537 - - - - - - -
Trade payables - - - - - - - - - - - -
Short-term loans and borrowings 3.123.356 - - - 1.206.589 - 1.289.073 147.694 - - - 480.000
Liabilies for bills of exchange recourse rights 2.869.816 - - - - - - - - - 3.349.816 (480.000)
Other short-term liabilities (147.694) - - - - - - (147.694) - - - -
5.845.478 - - - 1.206.589 - 1.289.073 - - - 3.349.816 -
TOTAL LIABILITIES 6.037.015 - - - 1.398.126 - 1.289.073 - - - 3.349.816 -
IMPACT ON NET EQUITY (4.946.790) - (3.504.204) (102.932) - - (1.289.073) - - (50.581) - -
30
Agrokor d.d.
Impact on the Profit and loss statement

(increase/ (decrease))
2015
000 HRK Note
A. Impact on revenues -
Service costs 17,955 2.4.12
Impairment of long and short term assets 1,057,297 2.4.3; 2.4.9
1,075,252
Financial expenses 34,220 2.4.12
B. Impact on expenses 1,109,472
Net impact on current year result (A-B) (1,109,472)
2.4.1 Reclassification of investments in subsidiaries and associates
As at 31 December 2015 the Company classified investments of HRK 1,252,771 thousand as “Available for
sale investments” and HRK 29,033 thousand as “Other short term invetstments” (1.1.2015: HRK 29,003
thousand) although, as of that date, the Company already had control or significant influence over these
investments. Due to this, at 31 December 2015 available for sale investments and other short term
investments were overstated by HRK 1,252,771 thousand and HRK 29,033 thousand respectively while
investments in subsidiaries and investments in associates at 31 December 2015 were understated by HRK
1,251,205 thousand and HRK 30,599 thousand (1.1.2015: HRK 29,033 thousand) respectively.
2.4.2 Measurement of investments in subsidiaries
Until 2011 the Company measured investments in subsidiaries in the separate financial statements using the
equity method although, in accordane with IAS 27 Consolidated and separate financial statements
(subsequently IAS 27 Separate Financial Statements (2011)), such accounting method was not permitted. In
the period from 2011 until 2015 the Company did not change the value of investments in subsidiaries, i.e. no
share in the result of associates for the period 2012 - 2015 was recognized. Due to this, investments in
subsidiaries as at 1 January 2015 and as at 31 December 2015 were overstated by HRK 3,504,204 thousand.
However, commencing 1 January 2016, the equity method of accounting in measuring investments in
subsidiaries in separate financial statements is permitted again and, if elected should be applied
retrospectively. Due to the impracticability to reliably determine the impact of the equity method the
Company elected to measure investments in subsidiaries in the separate financial statements at cost.
2.4.3 Impairment of investments in subsidiaries and associates
In previous periods the Company applied criteria for impairment of investments in subsidiaries and
associates which did not consider all impairment indicators although it is probable that such indicators
already existed in prior periods. In 2016 Management of the Company performed recoverability analysis of
these investments and adjusted carrying values of investments in subsidiaries, associates, loss carried
forward and loss for the year as at 1 January 2015 and as at 31 December 2015 and for the year then ended.
31
Agrokor d.d.
2.4.4 Not disclosed balances in the previous financial statements

During the period from 2010-2015 the Company recorded in the accounting records, but has not recognised
in the financial statements the following transactions, which is not in accordance with IFRS and the
substance of the transactions:
- period end journal entries as at 31 December 2015 to conceal borrowings amounting to HRK
2,654,915 thousand (1 January 2015: HRK 1,398,126 thousand), operating and interest expenses
presented on 31 December 2015 as receivables from the owner amounting to HRK 1,039,223
thousand (1 January 2015: HRK 697,100 thousand), assets amounting to HRK 1,615,692 thousand
HRK (2015: 701.026 thousand HRK).
The scheme affected the previously reported financial statements of the Company from 2010 to 2015.
The understatement of operating and interest expenses from 2010 to 2015 is summarized in the table
below. In 2016, the HRK 2,264,965 thousand was recognized as operating and interest expense.
Year HRK’000
2010 57,500
2011 429,143
2012 472,593
2013 468,572
2014 494,193
2015 342,964
Total 2,264,965
In respect of the errors above, the Company has commenced several investigations into this matter. These
investigations are currently ongoing and may result in potential future adjustments to the financial
statements.
32
Agrokor d.d.
2.4.5 Reclassification of deposits from cash equivalents

As at 31 December 2015 the Company classified short term deposits of HRK 1,617,289 thousand (1January
2015: HRK 1,643,723 thousand) and long term deposit of HRK 461,214 thousand (1.1.2015: HRK 460,878
thousand) as “Cash and cash equivalents” although such deposits do not meet criteria of cash equivalents as
defined in IAS 7 Cash flow statement. As a result, at 31 December 2015 “Cash and cash equivalents” were
overstated by HRK 2,078,502 thousand (1 January 2015: HRK 2,104,601 thousand) while “Short term
deposits” and “Long term deposits” were understated by HRK 1,617,289 thousand (1 January 2015: HRK
1,643,723 thousand) and HRK 461,213 thousand (1 January 2015: HRK 460,878 thousand), respectively.
2.4.6 Reclassification of borrowing from equity

As at 31 December 2015 the Company classified athird party borrowing totalling HRK 1,289,073 thousand (1
January 2015: HRK 1,289,073 thousand) as part of equity. The Company has corrected classification at 1
January 2015 and as at 31 December 2015 by adjusting balances of borrowings and other reserves
accordingly.
2.4.7 Reclassification of borrowings from trade and other payables

As at 31 December 2015 the Company classified liabilities with caracteristics of financing of HRK 77,729
thousand as Trade payables (1 January 2015: HRK 0) and HRK 52,500 thousand as Other short term liabilities
(1 January 2015: HRK 147,694 thousand). The Company has corrected classification at 1 January 2015 and as
at 31 December 2015 by adjusting balances of borrowings, trade payables and other short term liabilities
accordingly.
2.4.8 Reclassification of loans, deposits and interest receivables from third party receivables to
intercompany receivables
As at 31 December 2015 the Company classified certain loans, deposits and interest receivables as third
party receivables although they related to receivables from related parties. The Company has corrected
classification at 1 January 2015 and at 31 December 2015 by adjusting balances of Short term loans –
Agrokor Group and Long-term loans and deposits, Short term loans and deposits and Other receivables
accordingly.
2.4.9 Impairment of loans, deposits and trade receivables

In previous periods the Company applied criteria for impairment of loans, deposits and trade receivables
which did not consider all impairment indicators although it is probable that such indicators already existed
in prior periods. In 2016 Management of the Company performed a recoverability analysis of these
investments and adjusted carrying values of loans, deposits, trade receivables, loss carried forward and loss
for the year as at 1 January 2015 and as at 31 December 2015 and for the year then ended accordingly.
2.4.10 Bills of exchange with recourse rights

The Company did not recognize in previous periods receivables/ liabilities relating to bills of exchange with
recourse rights. The corrections resulted in an increase in receivables and liabilities as of 1 January 2015 and
as of 31 December 2015.
2.4.11 Reclassification of bills of exchange from trade payables

As at 31 December 2015 the Company classified liabilities for bills of exchange as Trade payables although
part of these liabilities has characteristics of financing. The Company has corrected classification at 1
January 2015 and at 31 December 2015 by adjusting balances of borrowings and trade payables accordingly.
2.4.12 Expenses not recognized in appropriate period (cut off error)

The Company identified certain expenses that were not recognized in the period when incurred but in the
subsequent period, and therefore adjusted liabilities and operating expenses as of 31 December 2015 and
for the period then ended.
33
Agrokor d.d.
3. Revenue
Revenue consists of:

2015
2016 000 HRK
000 HRK Restated
Income from sales of services – domestic 317,119 321,003
Income from sales of services – abroad 48,721 2,099
Other sales 32,458 297,564
Total 398,298 620,666
4. Other income
Other income consists of:

2015
2016 000 HRK
000 HRK Restated
Collected previously written-off receivables 757 722
Income from sales of assets 79 489
Subsequently determined income from previous years 163 105
Release of provisions 106 52
Total 1,105 1,368
5. Cost of energy and materials
Costs of raw materials and materials consist of:

2015
2016 000 HRK
000 HRK Restated
Energy 7,371 4,245
Materials used 4,670 2,954
Small inventory write offs 645 829
Total 12,686 8,028
6. Service costs
2015
2016 000 HRK
000 HRK Restated
Professional services 103,332 20,550
Agency services 51,510 -
IT services 13,088 16,250
Rent 30,280 6,809
External maintenance services 6,865 5,949
Postal and telephone expenses 1,833 1,976
Marketing, fairs and advertising 2,254 1,670
Transportation services 5,450 788
Other services 22,171 9,307
Total 236,783 63,299
Increase in service costs in 2016 comparing to the previous year mainly relates to costs recognized as
explained in note 2.4.4.
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Agrokor d.d.
7. Personnel expenses
Personnel expenses consist of:

2015
2016 000 HRK
000 HRK Restated
Salaries (net) 52,754 56,363
Tax and surtax from salaries 26,441 28,180
Pensions contributions 15,633 17,446
Contributions on salaries 16,389 17,635
Total 111,217 119,624
Compensations for managers (salaries) are included in personnel expenses and bonuses are not being paid
out.
8. Impairment of long and short term assets
Impairment of long and short term assets consists of:

2015
2016 000 HRK
000 HRK Restated
Impairment of investments in subsidiaries 2,634,651 1,021,786
Impairment of receivables – Agrokor group 2,376,366 -
Impairment of financial assets (loans and deposits) 1,915,353 -
Impairment of trade and other receivables – external 961,838 35,511
Total 7,888,208 1,057,297
9. Other expenses
Other expenses consist of:

2015
2016 000 HRK
000 HRK Restated
Bank charges and fees 513,152 51,231
Subsequently determined costs of previous periods 160,990 75
Consulting fees 115,168 8,031
Attorneys and legal advisors 111,489 4,622
Penalties 110,487 -
Representation 21,956 2,235
Business trips 6,923 5,266
Insurance premium 3,190 1,882
Professional education and literature 817 2,816
Compensation of expenses to employees 757 1,177
Other expenses 148,062 17,061
Total 1,192,991 94,396
Increase in other expenses in 2016 comparing to the previous year mainly relates to expenses recognized as
explained in note 2.4.4.
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Agrokor d.d.
10. Financial income
Financial income consists of:

2015
2016 000 HRK
000 HRK Restated
Interest income 407,045 570,462
Dividends 375,775 436,629
Other financial income 209,012 201,838
FX gains 183,276 108,114
Net gain on sale of shares - 31,557
Total 1,175,108 1,348,600
11. Financial expenses
Financial expenses consist of:
2015
2016 000 HRK
000 HRK Restated
Interest expense 2,747,505 1,630,022
FX losses 88,500 269,215
Net loss from sale of shares 3,408 20,783
Other financial expenses 121,624 -
Total 2,961,037 1,920,020
12. Components of other comprehensive income
2015
2016 000 HRK
000 HRK Restated
Cash flow hedging::
Gains/(losses) during the year:
Reclassification to profit or loss during the year - 26,516
Loss during the year - -
Total - 26,516
Investments available for sale:

Fair value gains during the year - 10,929
Fair value losses during the year (12,439) (1,514)
Total (12,439) 9,415
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Agrokor d.d.
13. Intangible assets
Changes in the carrying amount of intangible assets in 2016 were as follows:
Other Assets under

intangible assets construction Total
Cost 000 HRK 000 HRK 000 HRK
As at 01 January 2016 6,254 - 6,254
Disposal (151) - (151)
As at 31 December 2016 6,103 - 6,103
Accumulated amortization
As at 01 January 2016 5,132 - 5,132
Charge for the year 924 - 924
Disposal (111) - (111)
As at 31 December 2016 5,945 - 5,945
Net book value

As at 01 January 2016 1.122 - 1.122
As at 31 December 2016 157 - 157
Changes in the carrying amount of intangible assets in 2015 were as follows:
Intangible Assets under

investments construction Total
Cost 000 HRK 000 HRK 000 HRK
As at 01 January 2015 6,234 - 6,234
Investments during the year - 20 20
Transfer from assets under construction 20 (20) -
As at 31 December 2015 6,254 - 6,254
As at 01 January 2015 3,673 - 3,673
Charge for the year 1,459 - 1,459
As at 31 December 2015 5,132 - 5,132
Net book value

As at 01 January 2015 2,561 - 2,561
As at 31 December 2015 1,122 - 1,122
37
Agrokor d.d.
14. Property, plant and equipment
Changes in carrying amount of property, plant and equipment in 2016 were as follows:
Plant and Investments Assets under

Buildings equipment Other assets in real estate constr Total
Cost 000 HRK 000 HRK 000 HRK 000 HRK 000 HRK 000 HRK
As at 01 January 2016 135,467 36,073 3,295 115,596 15 290,446
Additions during the year - - - - 7,997 7,997
Transfer from assets under
construction - 554 - 298 (852) -
Disposal - (1,721) - (42,486) - (44,207)
Write off - (236) - - - (236)
As at 31 December 2016 135,467 34,670 3,295 73,407 7,160 253,999
As at 01 January 2016 42,238 34,083 - 32,346 - 108,667
Charge during the year 3,387 620 - 1,577 - 5,584
Disposal - (1,279) - (1,115) - (2,394)
Write off - (231) - - - (231)
As at 31 December 2016 45,625 33,192 - 32,808 - 111,625
Net book value

As at 01 January 2016 93,229 1,990 3,295 83,250 15 181,779
As at 31 December 2016 89,842 1,478 3,295 40,599 7,160 142,375
Changes in carrying amount of property, plant and equipment in 2015 were as follows:
Plant and Investments Assets under

Buildings equipment Other assets property constr Total
Cost 000 HRK 000 HRK 000 HRK 000 HRK 000 HRK 000 HRK
As at 01 January 2015 135,467 57,586 3,295 124,493 15 320,856
Additions during the year - - - - 911 911
Transfer from assets under
construction - 911 - - (911) 0
Merger - - - 5,964 - 5,964
Disposal - (22,235) - (14,861) - (37,096)
Write off - (189) - - (189)
As at 31 December 2015 135,467 36,073 3,295 115,596 15 290,446
As at 01 January 2015 38,851 41,130 - 33,887 - 113,868
Charge during the year 3,387 1,730 - 2,054 - 7,171
Disposal - (8,588) - (3,595) - (12,183)
Write off - (189) - - - (189)
As at 31 December 2015 42,238 34,083 - 32,346 - 108,667
Net book value

As at 01 January 2015 96,616 16,456 3,295 90,606 15 206,988
As at 31 December 2015 93,229 1,990 3,295 83,250 15 181,779
Property, plant and equipment is not mortgaged. The Company has adequate proof regarding ownership over
the above stated property.
38
Agrokor d.d.
15. Investments in subsidiaries
Shares in subsidiaries are as follows:
% share 31 December 31 December

31 December 2016 2015
Country 2016 000 HRK 000 HRK
Adriatica.net d.o.o. Croatia 92.36% 148,172 148,172
Agrokor-trgovina d.d. Croatia 100.00% 1,532 1,532
Agrokor Ag Zug Switzerland 100.00% - 462
Agrolaguna d.d. Croatia 85.22% 127,030 127,030
Belje d.d. Croatia 94.23% 1,773,469 1,773,469
Dijamant a.d. Serbia 96.14% 602,995 602,995
Jamnica d.d. Croatia 80.44% 63,947 63,947
Konzum d.d. Croatia 88.01% - 707,355
Bosnia and
Konzum Sarajevo Herzegovina 100.00% - 1,865,951
Kron d.o.o. Serbia 100.00% 171,425 171,425
Ledo d.d. Croatia 55.30% 62,396 62,396
L.G. Moslavina d.o.o. Croatia 100.00% 50,929 50,929
mStart d.o.o. Croatia 100.00% 147,668 147,668
Nova Sloga d.o.o. Serbia 100.00% 128,760 128,760
PIK Vinkovci d.d. Croatia 70.87% 89,131 89,131
Poslovni sistem Mercator d.d. Slovenia 59.47% 2,544,638 2,544,638
Projektgradnja d.o.o. Croatia 77.15% 77,176 111,792
Rivijera d.d. Croatia 100.00% - 27,333
Roto Ulaganja d.o.o. Croatia 100.00% 179,525 182,461
Tisak d.d. Croatia 51.34% 328,781 351,783
Bosnia and 51.00%
TPDC Sarajevo d.d. Herzegovina 49,710 49,710
Solana Pag d.d. Croatia 96.93% 27,329 27,329
Vupik d.d. Croatia 88.34% 657,558 657,558
Zvijezda d.d. Croatia 51.84% 93,482 93,482
Other 31,650 126,792
Total 7,357,303 10,114,100
In comparison to 2015, in 2016 the Company sold 16% in Tisak d.d. and acquired 3.43% in Projektgradnja d.o.o.
In the period from December 2012 untill April 2017 the Company entered into over 1,200 repurchase
agreement transactions relating to the shares of its controlled and affiliated companies and currently a forensic
review of those transactions is undergoing. Depending on the findings of this review it is possible that certain
information relating to ownership percentages disclosed in this note will be subject to restatement in the
subsequent periods.
As at 31 December 2016 the Company performed assessment of recoverability of investments in subsidiaries
and based on this assessment the Company recorded impairment of HRK 2,634,651 thousand mainly relating to
investments in Konzum Sarajevo d.o.o. and Konzum d.d. as further described in Note 2.3.21 Critical accounting
estimates and judments.
Movement of impairment provision for investments in subsidiaries is as follows:
2016 2015
000 HRK 000 HRK
As at 01 January 1,021,786 -
Charge for the year 2,634,651 1,021,786
Amounts written off - -
As at 31 December 3,656,437 1,021,786
39
Agrokor d.d.
16. Investments in associates
Investments in associates are as follows:

2015
2016 000 HRK
000 HRK Restated
As at 01 January 198,186 55,863
Acquisition/paid in capital 69,519 165,364
Disposal - (19,242)
Share in profit/(loss) of associates 7,975 (3,799)
As at 31 December 275,680 198,186
During 2015, through the merger of Media d.o.o. the Company acquired 49% share in the Zagreb plakat d.o.o.
for HRK 112,115 thousand, 25% share in KHA 4 d.o.o and increased share capital in KHA 4 d.o.o. by HRK 15,000
thousand as well as paid in capital of Karisma Hotels Adriatic d.o.o. in the amount HRK 7,650 thousand (without
changes in ownership share). In 2015 the Company sold its share in Ambalažni servis d.o.o.
Increase in 2016 relates to acquisition of share in Stega Tisak d.o.o. for an amount of HRK 30,162 thousand and
recapitalization of KHA 4 d.o.o. and Karisma Hotel Adriatic d.o.o. The Company holds 49% of voting rights in
Stega Tisak d.o.o. All associates, except Jana North America are incorporated in Croatia. Jana North America is
incorporated in USA.
The summarized 2016 and restated 2015 financial information of associates is as follows:
Jana North America, Inc. 2016 2015

000 HRK 000 HRK
Short-term assets 1,744 1,971
Long-term assets 14 65
Short-term liabilities (53,854) (51,663)
Long-term liabilities - 0
Net assets (52,094) (49,627)
Income 6,840 9,950

Loss (5,115) (16,949)
Gulliver travel d.o.o. 2016 2015

000 HRK 000 HRK
Long-term assets 4,620 5,058
Long-term liabilities - -
Net assets 10,596 21,990
Income 116,476 108,863

Loss 3,500 2,823
Karisma Hotels Adriatic d.o.o. 2016 2015

000 HRK 000 HRK
Long-term liabilities (131) (9)
Net assets 109,713 84,148
Income 17,089 15,508

Profit/ Loss 385 293
40
Agrokor d.d.
16. Investments in assiciates (continued)
Zagreb plakat d.o.o. 2016 2015

000 HRK 000 HRK
Restated
Long-term liabilities - (10)
Net assets 17,037 14,211
Income 34,254 30,831

Profit 10,641 7,634
KHA 4 d.o.o. 2016 2015

000 HRK 000 HRK
Short-term liabilities (311) (32)
Long-term liabilities - -
Net assets 196,413 129,777
Income 1,984 344

Loss 1,629 (492)
17. Non-current financial assets
Financial assets consist of:

31 December 2015
31 December 2016 000 HRK
000 HRK Restated
Loan receivables 287,612 1,640,109
Loan receivables – Agrokor Group 151,156 152,701
Deposits 546,943 583,418
Available for sale investments 213,943 164,024
Held to maturity investments 82,191 86,138
Total 1,281,844 2,626,390
Long-term deposits mainly relate to cash depositsdeposit used as collateral for long term borrowingsborrowing
and to leasing deposits that bear no interest and whose maturity is on the repayment date of contracted
liabilities.
The structure of long-term loan receivables is as follows:

31 December 2016
000 HRK Maturity Interest rate
Investment loans 1,750 3 years 10%
Loans for business support 97,540 4 years 3%
Other loans 188,322 Up to 4 years 7%
Total 287,612
41
Agrokor d.d.
17. Financial instruments (continued)
31 December 2015
000 HRK Maturity Interest rate
Loan to the owner 268,505 3-20 years 4.5-6%
Loans for investment in real estate 221,082 2-15 years 2.5-9%
Investment loans 85,379 2 g years 4-9%
Loans for business support 133,401 2-4 years 7-10%
Other loans 931,742 Up to 3 years 7-9%
Total 1,640,109
Loans are mainly unsecured.

Loans granted to companies that are members of Agrokor Group are as follows:
31 December 2015
000 HRK Restated
Mercator Grupa 151,156 152,701
Total 151,156 152,701
Investments in equity securities available for sale
31 December 2016 31 December 2015

000 HRK
000 HRK Restated
Securities valued at cost 194,926 122,261
Securities quoted in active market – at fair value 19,017 41,763
Total 213,943 164,024
Investments in securities available for sale are not quote on active market are valued at cost.
42
Agrokor d.d.
18. Short term loans, receivables and deposits
Short-term investments consist of:

31 December 2015
000 HRK Restated
Loan receivables – Agrokor Group 2,601,011 4,982,966
Short-term loans and deposits 273,717 1,569,089
Total 2,874,728 6,552,055
Deposits have a maturity between 3 and 12 months with annual interest rate up to 6%. Loans have a maturity
of 12 months with annual interest rate of up to 8.95%.
Loans granted to companies that are members of Agrokor Group are as follows:
31 December 2015
000 HRK Restated
A007 d.o.o. 10,895 1,238
Adriatica.net d.o.o. 323,965 285,960
Agrokor AG 491,268 421,166
Agrokor kft - 804
Agrokor-trgovina d.d. - 405,535
Agrolaguna d.d. 206,546 178,356
Aliquantum ulaganja d.o.o. 117,944 -
Belje d.d. 957,196 534,343
Dalmarina d.o.o. 42,563 41,554
Dijamant a.d. - 193,363
INIT d.o.o. Sarajevo 5,134 4,979
Konzum d.d. 1,252,181 1,451,227
L. G. Moslavina d.o.o. 139,188 123,859

Mercator grupa 10,164 6,805
Nova sloga d.o.o. 3,058 3,159
PIK Vinkovci d.d. 782,719 640,990
Plodovi Podravine d.o.o. 2,864 2,700
Poliklinika Aviva d.o.o. 34,382 33,204
Projektgradnja d.o.o. 31,615 -
Rivijera d.d. 22,010 23,152
Roto Dinamic d.o.o. - 77
Roto Ulaganja d.o.o. 13,754 309
SK-735 d.o.o. 25,276 20,571
Solana Pag d.d. 793 1,421
Sojara d.d. 97,966 87,784
Tisak d.d. 55,808 -
TPDC Sarajevo d.o.o. 12,665 17,168
Vupik d.d. 511,566 503,242
Value adjustment (2,550,509) -
Total 2,601,011 4,982,966
Loans to related parties are loans granted for current liquidity. At 31 December 2016 interest rate amounted to
5.14% (31 December 2015: 3.00%). Loans between related parties are mainly unsecured.
43
Agrokor d.d.
19. Receivables for bills of exchanges and recourse rights
31 December 2015
000 HRK Restated
Bills of Exchange 158,681 877,071
Receivables for bills of exchange - recourse right 3,064,071 3,083,166
Total 3,222,752 3,960,237
The Company accepts bills of exchange as a means of payment of the customer and this settles their
receivables from the sale of services. Received bills of exchange can be discounted by factoring companies. Bills
are with recourse and the Company provides a guarantee in case the factoring companies fail to collect
receivables from the customer. In the case of activation of recourse, liability of bill payment is transferred to
the Company whilst the Company is entitled to a receivable for unpaid bills to the original issuer of the bill. As
at 31 December 2016 the Company recognized receivables and liabilities based on the bills of exchange
recourse rights of HRK 3,064,071 thousand (2015: HRK 3,083,166 thousand). As during 2016 and previous
periods there was no activation of the recourse rights the Company did not recognize these assets and
liabilities in the past.
Out of total outstanding bills of exchange of HRK 877,071 thousand at 31 December 2015, HRK 173,056
thousand relates to bills of exchange issued to related parties.
20. Receivables
Receivables consist of:

31 December 2015
000 HRK Restated
Trade receivables 235,066 484,060
Trade receivables – Agrokor Group 75,626 81,564
Receivables from employees 336 412
Other receivables 999,627 239,095
Receivables from the owner - 1,066,890
Provision for impairment of trade and other receivables (1,078,689) (125,585)
Total 231,966 1,746,436
Other receivables relate to receivables from pre-bankruptcy proceedings settlements and to receivables for
interest.
The Company does not achieve with any trade receivable a turnover that exceeds 10% of the total annual
turnover.
Movement of impairment provision of trade and other receivables is as follows:

2015
2016 000 HRK
000 HRK Restated
As at 01 January 125,585 74,137
Charge for the year 961,838 35,511
Amounts written off (8,734) -
Other - 15,937
As at 31 December 1,078,689 125,585
44
Agrokor d.d.
Maturity structure of gross trade receivables is as follows:

0-90 90 -180 180 – 270 Over 270
Not due days days days days Total
000 HRK 000 HRK 000 HRK 000 HRK 000 HRK 000 HRK
2016 4,615 - - - 230,451 235,066
2015 387,381 29,403 1,129 1,225 64,921 484,060
20. Receivables (continued)

Trade receivables from companies that are members of Agrokor Group are as follows:
31 December 2015
000 HRK Restated
A007 d.o.o. 1,322 -
Agkor d.o.o. 6 -
Agrokor AG Zug 62 -
Agrokor-trgovina d.d. 10 10
Agrokor-Energija d.o.o. 739 22
Agrokor – Zagreb d.o.o. 33 -
Agrolaguna d.d. - 140
Angropromet d.o.o. 12 -
Belje d.d. 3,286 1,154
Dalmarina d.o.o. 4 -
Dijamant a.d. 43 -
Fonyodi Kft. 230 -
Frikom d.o.o. 1,423 -
Frikom Beograd dooel 398 -
Idea d.o.o. 159 -
INIT d.o.o. Sarajevo 13 -
Jamnica d.o.o. Maribor 119 -
Kikindski mlin a.d. 16 -
Konzum d.o.o. Sarajevo 22,294 -
Konzum d.d. - 7,507
Kor-Broker d.o.o. - 51
Kron a.d. 14 -
Ledo d.o.o. Čitluk 583 -
Ledo d.o.o. Kosovo 160 -
Ledo d.o.o. Ljubljana 301 -
Ledo Kft. 52 -
Lovno gospodarstvo Moslavina d.o.o. 1 -
Mg Mivela d.o.o. 649 -
Nova sloga d.o.o. 746 -
PIK BH d.o.o. 72 -
PIK Vinkovci d.d. 173 322
Projektgradnja d.o.o. - 1,196
Roto dinamic d.o.o. - 3,177
Sarajevski kiseljak d.d. 40,554 67,951
Solana Pag d.d. - 34
Super kartica d.o.o. Beograd 146 -
Super kartica d.o.o. BH 66 -
TPDC Sarajevo d.d. 40 -
Velpro d.o.o. Sarajevo 1,450 -
Zvijezda d.o.o. Sarajevo 309 -
Zvijezda d.o.o. Ljubljana 134 -
Total 75,626 81,564
45
Agrokor d.d.
21. Other current assets
Other current assets consist of:

31 December 2015
000 HRK Restated
Prepaid discount expenses - 31,117
Prepaid expenses for long-term loans 6,879 13,547
Other 18,226 16,327
Total 25,105 60,991
In 2015 prepaid discount expenses relate to the portion of discountsdiscount on bills of exchange that are
maturing in the subsequent period.
22. Cash and cash equivalents
Cash in bank and on hand consists of:

31 December 2015
000 HRK Restated
Cash in bank and on hand 921 6,222
Cash equivalents - 24,000
Total 921 30,222
Cash equivalents are short-term deposits with banks with original maturity up to 3 months. Bank deposit
outstanding at 31 December 2015 was pledged in favor of Sberbank and matured on 8 January 2016.
23. Equity and reserves
Equity and reserves represent total amount of own resources. It comprises share capital together with capital
reserves, legal reserves, revaluation reserves, retained earnings and profit for the year. Share capital (share
equity) in court registry amounts to HRK 180,123 thousand. Share capital is divided into 360,246 ordinary
shares with nominal value of 500 HRK. Equity was paid in full. Legal reserves of HRK 9,007 thousand are not
distributable.
Ownership structure at 31 December 2016 and at 31 December 2015:
Nominal value of
1 share Total nominal value
Particip. in share
Number of shares In HRK 000 HRK capital (%)
Adria Group Holding BV 344,120 500 172,060 95.52%
Banks 7,468 500 5,216 2.08%
Small shareholders 5,698 500 1,367 0.82%
Treasury shares 2,960 500 1,480 0.82%
Total number of shares 360,246 180,123 100.00%
During 2016 the Company acquired 2,965 treasury shares (0.82%) which are included in the Small shareholders
line as the process of registering those shares to the Company is still ongoing.
46
Agrokor d.d.
24. Lease liabilities
Operating lease liabilities
Operating lease includes lease of buildings, equipment and vehicles.
31 December 2015
Maturity of non-cancellable future lease payments 000 HRK Restated
Payable from 2 to 5 years 4,468 4,357
Payable from 1 to 2 years 3,641 3,422
Payable within 1 year 4,423 4,548
Total 12,531 12,327
The average cancellation period in operating lease agreements is between 6 and 9 months.
Operating lease commitments are not provided for in the financial statements in accordance with accounting
regulations.
25. Provisions
Provisions consist of:

. 31 December 2015
000 HRK Restated
Provisions for severance payments 430 537
Other provisions 84 84
Total 514 621
Provisions for severance payments
All employees are covered by the State pension fund. Provisions are recognised for other employee benefits
payable in respect of retirement and jubilee (length of service). Retirement benefits are dependent on the
employees fulfilling the required conditions to retire from the Company and jubilee benefits are dependent on
the number of years of service in the Company. The amount of all benefit entitlements is determined by the
respective employee’s monthly remuneration.
Movement of liabilities towards employees disclosed in the profit and loss statement is as follows:
2016 2015
000 HRK 000 HRK
Restated
Net liability at beginning of the year 537 586
Net change recognized in the profit and loss statementstate,emts (107) (49)
Payments made during the year - -
Net liability at the end of the year 430 537
47
Agrokor d.d.
25. Provisions (continued)
The main actuarial assumptions used to determine liabilities as at 31 December were as follows:
2016 2015
Discount rate (annual) 4.33% 4.33%
Wage and salary increases (annual) 3.00% 3.00%
Other long-term benefits are accrued by using the projected unit credit method of employer per employee.
Gains and losses offseting from changes in actuarial assumptions are recognized as gains/losses in the period.
Other provisions
Other provisions relate to provisions for ongoing court proceedings.
Movement of liabilities related to court proceedings is as follows:

2016 2015
000 HRK 000 HRK
Net liability at beginning of the year 84 84
Charge - -
Write offs - -
Net liability at the end of the year 84 84
26. Loans and borrowings
Long-term and short-term liabilities are as follows:

31 December 2015
000 HRK Restated
Bank loans 12,831,323 12,636,843
Bonds 6,828,570 6,808,483
Non-bank loans 302,312 991,481
Total long-term liabilities 19,962,205 20,436,807
Current portion of long-term liabilities

Bank loans (984,456) (4,080,554)
Total current portion of long term liabilities (984,456) (4,080,554)
Long-term liabilities 18,977,749 16,356,254
Short-term loans
Bank loans 914,924 1,512,624
Non-bank loans 1,788,363 502,840
Borrowings – Agrokor Group 2,231,826 1,332,934
Bills of exchange 383,780 553,750
Total short-term loans 5,318,893 3,902,148
Total loans 24,296,642 20,258,506
48
Agrokor d.d.
26. Loans and borrowings (continued)
The Agrokor Group finances itself mainly through Agrokor d.d. via a combination of fixed income instruments
and variable rate loans. Variable interest rates are predominantly linked to EURIBOR. The coupons/interest
rates range between 3% and 10% p.a.
Senior Notes
Company’s debt consists primarily of two Senior Notes and other bilateral facilities with banks and financial and
non-financial institutions. The 2019 Senior Notes were issued at par in an aggregate principal amount of €300
million. The 2019 Senior Notes are scheduled to mature on May 1, 2019 and accrue interest at a rate of 9.875%
per annum. The euro-denominated 2020 Notes were issued at par in an aggregate principal amount of €325
million. The euro-denominated 2020 Notes are scheduled to mature on February 1, 2020 and accrue interest at
a rate of 9.125% per annum. The dollar-denominated 2020 Notes were issued at par in an aggregate principal
amount of $300 million. The dollar-denominated 2020 Notes are scheduled to mature on February 1, 2020 and
accrue interest at a rate of 8.875% per annum.
Refinanced debt
The Company completed a wider refinancing exercise in the second half of the year, extending c. €840 million
of existing debt to approximately 2-3 year maturities. Refinanced bilateral facilities consist of two club facilities
with BNP Paribas, Credit Suisse AG, London Branch, Goldman Sachs International Bank, J.P. Morgan Securities
plc in the amount of €100 million each, one scheduled to mature on September 14, 2018 and the other on
September 14, 2019. Both facilities accrue interest at a rate of EURIBOR plus a margin of 5.00%.
Sberbank loans
The Company has a €600 million loan with Sberbank of Russia and Sberbank Europe AG and a €350 million loan
with Sberbank of Russia, the former scheduled to mature on September 14, 2023 and accrues interest at a rate
of EURIBOR plus a margin of 5.30% and the latter scheduled to mature on September 14, 2022 and accrues
interest at a rate of 6.00% fixed. The Company also has a €50 million loan with Sberbank Europe AG scheduled
to mature on September 14, 2018 and accrues interest at a rate of EURIBOR plus a margin of 5.00%.
VTB loans
The Company has a €360 million with VTB Bank Austria AG, of which €50 million is scheduled to mature on
September 14, 2018 and accrues interest at a rate of EURIBOR plus a margin of 5.00%, €250 million scheduled
to mature on September 14, 2019 and accrues interest at a rate of EURIBOR plus a margin of 5.00% and €60
million scheduled to mature on June 21, 2020 and accrues interest at a rate of EURIBOR plus a margin of 3.62%.
Non bank loans

Agrokor Restricted Group has several other facilities with local and international institutions with fixed and
variable rates of which the most material ones are €130 million from Adris Grupa d.d. scheduled to mature on
December 31, 2017 and accrues interest at a rate of 4.00%, €50 million from Zagrebačka banka d.d. scheduled
to mature on April 17, 2017 and accrues interest at a rate of EURIBOR plus a margin of 4.75%, €50 million from
Aquarius scheduled to mature on August 8, 2017 and accrues interest at a rate of EURIBOR plus a margin of
5.50%, €50 million from Tvornica Duhana Rovinj d.d. scheduled to mature on November 30, 2021 and accrues
interest at a rate of 2.50%. Other smaller facilities are scheduled to mature between 2017 and 2028 and accrue
interest at a rate between 3% and 10% p.a.
Covenants
The covenants of the Agrokor Restricted Group debt facilities are aligned with the debt covenants of the 2019
and 2020 Senior Notes. The Senior Notes are generally guaranteed by the following companies: Agrokor-
trgovina d.d., Jamnica d.d., Konzum d.d., Ledo d.d., Ledo d.o.o. Čitluk, PIK Vinkovci d.d., Sarajevski kiseljak d.d.,
Zvijezda d.d., Vupik d.d., Belje d.d. Darda and Konzum d.o.o. Sarajevo. Certain of the refinanced facilities also
include undertakings by the Company that 90 days prior to their respective maturities, the PIK Facility and the
2019 bonds are refinanced or have their maturities extended to at least March 14, 2020 and Agrokor's
consolidated leverage ratio of the Restricted Group shall be less than 5.0x for the four most recent full fiscal
quarters immediately prior to September 14, 2018 for which internal financial statements are available. There
are some facilities which are either unsecured and unguaranteed or secured with collateral in the form of
shares, real estate of group companies and/or promissory notes.
49
Agrokor d.d.
Liabilities for borrowings from Agrokor Group members are as follows:
31 December 2015
000 HRK Restated
Agrokor AG 151,339 74,894
Agrokor trgovina d.d. 168,635 -
Irida d.o.o. 6,679 -
Jamnica d.d. 925,731 684,160
Kor Broker d.o.o. 1,153 1,200
Ledo d.d. 40,493 13,018
mStart d.o.o. - 2,939
Projektgradnja d.o.o. - 7,918
Roto dinamic d.o.o. 34,949 -
Tisak d.d. 411,041 248,149
Velpro-centar d.o.o. 82,825 -
Zvijezda d.d. 408,981 300,656
Total 2,231,826 1,332,934
Financing between related parties is performed based on the frame agreement with terms as disclosed in note
18.
27. Trade payables
Trade payables consist of:

31 December 2015
000 HRK Restated
Trade payables - domestic 41,803 41,484
Trade payables – foreign 19,383 4,706
Trade payables – Agrokor Group 36,389 106,786
Accruals 107 78
Total 97,683 153,054
Liabilities towards related parties, members of Agrokor Group are as follows:
31 December 2015
000 HRK Restated
Agrokor AG - 70,666
mStart d.o.o. 2,165 1,500
Tisak d.d. 8,466 8,716
Other 353 133
Total 36,389 106,786
50
Agrokor d.d.
28. Other short-term liabilities
Other short-term liabilities consist of:

31 December 2015
000 HRK Restaed
Deferred income and accrued expenses 311,073 270,216
Liabilities for tax and contributions 50,877 21,064
Liabilities towards employees 4,732 4,731
Other short-term liabilities 100,090 19,823
Total 466,772 315,834
Deferred income and accrued expenses consist of:

31 December 2015
000 HRK Restated
Accrued interest expenses 248,311 214,919
Other accrued expenses 59,642 52,175
Deferred income 3,120 3,122
Total 311,073 270,216
51
Agrokor d.d.
29. Transactions with related parties
The Company has transactions with the following related parties: significant shareholders, other companies
owned or controlled by the ultimate owner of the Company ('other affiliated parties') and key management.
Revenues and income realized from transactions performed with related parties are as follows:
2016 2015
000 HRK 000 HRK
Restated
A007 d.o.o. 1,405 -
Adriatica.net d.o.o. 13,813 -
Agrokor AG 22,190 16,484
Agrokor kft - 32
Agrokor-Energija d.o.o. 1,000 101
Agrokor-trgovina d.d. 26,909 63,559
Agrokor Zagreb d.o.o. - 8,005
Agrolaguna d.d. 10,596 12,513
Ambalažni servisi d.o.o. - 1,443
Belje d.d. 51,552 58,357
Dijamant a.d. 19,115 2,487
Frikom d.o.o. 6,259 -
Jamnica d.d. 47,346 75,886
Konzum d.d. 300,616 503,135
Konzum d.o.o. Sarajevo 22,237 -
Kor-Broker d.o.o. 4,112 2,406
Kron a.d. - 28,039
Ledo d.d. 79,441 95,859
Ledo d.o.o. Čitluk 4,036 -
L. G. Moslavina d.o.o. 6,786 8,212
Mg Mivela d.o.o. 1,007 -
mStart d.o.o. 38,938 23,019
Nova sloga d.o.o. - 140
PIK Vinkovci d.d. 37,105 37,421
PIK Vrbovec d.d. 8,239 23,123
Projektgradnja d.o.o. 1,652 -
Rivijera d.d. 1,695 -
Roto dinamic d.o.o. - 9,268
Roto ulaganja d.o.o. 8,243 70
Sarajevski kiseljak d.d. 3,144 31,770
Solana Pag d.d. 5,368 13,555
Sojara d.d. 4,737 4,886
Tisak d.d. 22,269 18,032
TPDC Sarajevo d.d. - 410
Velpro-centar d.o.o. 19,054 -
Velpro d.o.o. Sarajevo 1,444 -
Vupik d.d. 28,488 31,102
Zvijezda d.d. 4,230 13,668
Žitnjak d.d. - 3
Other 9,818 -
Total 823,559 1,093,806
52
Agrokor d.d.
29. Transactions with related parties (continued)
Transactions and balances with other related parties

2015
2016 000 HRK
000 HRK Restated
Ultimate parent 200.153 421,856
Ultimate controlling party 219.163 2,689,411
Remuneration paid to key management personnel
The remuneration paid to the members of the Management Board and other key management personnel
during the year was as follows:
2015
2016 000 HRK
000 HRK Restated
Wages and salaries (net) and other current benefits 4,481 4,192
Taxes and contributions out of salaries 3,596 3,837
Contributions on salaries 1,388 1,381
Retirement/ termination benefits 1,306 -
Total 10,771 9,410
30. Contingencies
Contingencies mainly relate to guarantees that the Company issued for liabilities of related party companies,
bank guarantees and other corporate guarantees.
Total amount of issued guarantees amounts to HRK 8,537,398 thousand.
In accordance with the Law for the Extraordinary Administration for Companies with Systemic Importance for
the Republic of Croatia claim reconciliation is currently ongoing. Upon the finalization of the reconciliation
process total amount of claims for each creditor will be determined.
31. Transactions with associates
Transactions with associates (Jana North America, Inc., Gulliver travel d.o.o., A.N.P. Energija d.o.o. Karisma
hotels Adriatic d.o.o., KHA četiri d.o.o., Zagreb plakat d.o.o., Tisak In post d.o.o., Photo boutique d.o.o. and
Stega Tisak d.o.o.), positions at the end of the year and relating income and restated 2015 were as follows:
(000 HRK)
Receivables 2016 2015
Trade receivables 34,969 30,577
Other 51,094 42,020
86,063 72,597
(000 HRK)
Liabilities 2016 2015
Trade payables - -
Other 53,499 -
53,499 -
(000 HRK)
Income 2016 2015
Income from sales 205 331
Other income 2,836 1,905
3,041 2,236
53
Agrokor d.d.
32. Fair value measurement
Based on the calculation of their fair value, financial instruments are divided into three levels:
 Level 1: quoted (stock) prices for assets or liabilities in active market
 Level 2: assets or liabilities not included in Level 1, the value of which is determined directly or indirectly
based on observable market data
 Level 3: assets or liabilities, the value of which is not based on observable market data.
Taking into account events relating to the extraordinary administration as disclosed in the Note 34 Events after the
balance sheet date which would affect the fair value of financial instuments, the Company does not disclose the fair
value hierarchy of financial instuments at 31 December 2016.
33. Financial instruments and risk management
(a) Financial instruments

Existing derivative financial instruments or any financial instruments do not expose the Company to
concentration of credit risk. It is the Company’s policy to enter into financial instruments with a diversity of
creditworthy counterparties. Therefore, the Company does not expect to incur material credit losses on its risk
management or other financial instruments.
Fair values of financial assets and liabilities

Fair value represents the amount for which an asset could be exchanged or a liability settled on an arm’s length
basis. As market prices are not available for a portion of the Company’s financial assets and liabilities, fair
values have been based on management assumptions according to the profile of the respective assets and
liabilities. The Company believes that the fair values of assets and liabilities (unless otherwise disclosed in this
note) are not significantly different from book values.
Due to the the Extraordinary Administration Process the Company is currently not able to determine the fair
value of liabilities.
Amounts and deposits due from Banks

For assets maturing within three months, the carrying amount approximates fair value due to the relatively
short term maturity of these financial instruments. For longer term deposits, the interest rates applicable
approximate market rates and, consequently, the fair value approximate the carrying amounts.
54
Agrokor d.d.
33. Financial instruments and risk management (continued)
Granted loans
As practically all loans are short term, the Company believes that their fair values are not significantly different
from book values.
Investment in securities
Securities available for sale are included in the balance sheet at their fair values. Equity securities whose fair
value cannot be reliably measured are included at acquisition cost. The Company believes that their fair values
are not below their carrying amounts.
Loans and borrowings

For balances maturing within one year the carrying amount approximates fair value due to the relatively short
term maturity of these financial instruments. Nominal value of our Senior Notes issued amounted to HRK
6,874.2 million, while their fair value as at December 31, 2016, based on closing prices on the Stock Exchange,
amounted to HRK 7,117.3 million. The 2019 Senior Notes traded at 103.6% of nominal value. The EUR and USD
tranche of the 2020 Senior Notes traded at 104.3% and 102.2%, respectively. As a portion of other longer term
funds received is contracted with variable interest rates, their fair value approximates the carrying amounts.
For longer term funds with fixed interest rates, the average interest rates applicable approximate market rates
and, consequently, the fair value approximate the carrying amounts.
The main risks arising from the Company’s financial instruments are credit risk, foreign currency risk and
interest rate risk. The Company reviews and agrees policies for managing each of these risks and they are
summarised below.
The Company is exposed to international markets. As a result, it can be affected by changes in foreign exchange
rates. The Company also extends credit terms to its customers and is exposed to a risk of default. The
significant risks, together with the methods used to manage these risks, are described below. The Company
does use derivative instruments to manage risk especially foreign exchange risk related to USD.
Credit risk
The Company is exposed to credit risk representing risk that the debtor will not be able to repay its liabilities to
the Company as they fall due. The Company manages this risk by setting limits of exposure towards one debtor
or group of debtors. As there is no significant concentration of credit exposure, the Company does not consider
to be excessively exposed to credit risk. The Company does not guarantee material obligations of other parties.
The Company considers that its maximum exposure is reflected by the amount of debt financial assets net of
provisions for impairment recognised at the balance sheet date.
Liquidity risk
Liquidity risk, also referred to as financing risk, is the risk that an enterprise will encounter difficulty in raising
funds to meet obligations associated with financial instruments. The Company has a strong focus on its cash
flow with short-term inflows and outflows forecasts. Surplus of funds is placed in short term deposits and
available for sale investments.
As part of its activities in 2017, the Company continually monitors liquidity to provide sufficient funds for its
operations, while maintaining sufficient space for using unused credit lines when needed. Such projection
considers the Company's plans to settle the debts, coordinate with the contractual relationship and internal
default balance in the balance sheet.
55
Agrokor d.d.
33. Financial instruments and risk management (continued)
Interest rate risk

As majority of long term debt bears variable interest, the Company considers itself to be exposed to risk of
adverse change in interest rates at an acceptable level.
Interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in market
interest rates relative to the interest rate which applies to the financial instrument. Interest rate risk related to
cash flow is the risk that the interest cost of an instrument will fluctuate over time.
Foreign currency risk

Most of the assets of the Company are denominated in Croatian Kuna. A significant portion of loan liabilities is
linked to foreign currency (predominantly EUR). Accordingly, the group is exposed to risk of changes in foreign
exchange rates. Considering long term policy of the Republic of Croatia related to maintenance of exchange
rate to EUR, the Company does not consider this risk to be significant.
34. Events after the balance sheet date
On 21 February 2017 the Company signed a loan agreement with Sberbank of Russia as Lender. The total loan
amount is EUR 100,000,000. The loan has a bullet repayment on 1 October 2017. The loan is guaranteed by the
following subsidiary companies: Agrokor-trgovina d.o.o., Belje d.d. Darda, Jamnica d.d., Konzum d.d., Konzum
d.o.o. Sarajevo, Ledo d.d., Ledo d.o.o. Čitluk, Pik-Vinkovci d.d., Sarajevski Kiseljak d.d., Vupik d.d. and Zvijezda
d.d. The loan has since been repaid in full from the proceeds of the loan concluded on 8 June 2017.
On 13 April 2017 the Company signed a loan agreement as a borrower with Zagrebačka banka d.d., Privredna
banka Zagreb d.d., ERSTE Staiermerkische d.d. and Raiffeisenbank Austria d.d. as loan providers. The total loan
amount was EUR 80,000,000. The loan has a bullet repayment at the expiration of 12 months from the date of
the opening of the Extraordinary Administration proceeding or at the expiration of 15 months from the date of
the opening of the Extraordinary Administration proceeding if the Extraordinary Administration proceeding is
prolonged. The loan is signed as co-debtors by the following subsidiary companies: Belje d.d. Darda, Jamnica
d.d., Konzum d.d., Ledo d.d., Pik Vrbovec – mesna industrija d.d., Pik-Vinkovci d.d., Vupik d.d. and Zvijezda d.d.
On 8 June 2017 the Company signed a laon agreement with various investors (such as Knighthead Capital
Investments) as loan providers. The total loan amount is up to EUR 1,060,000,000. The loan has a bullet
repayment on the earlier of 10 July 2018, the settlement date under the extraordinary administration
proceeding and opening of insolvency proceedings. The loan is guaranteed by the subsidiary companies
incorporated in Croatia and are subject to the extraordinary administration proceeding which include but are
not limited to: Agrokor-trgovina d.o.o., Belje d.d. Darda, Jamnica d.d., Konzum d.d., Ledo d.d., Pik-Vinkovci d.d.,
Sarajevski Kiseljak d.d., Vupik d.d. and Zvijezda d.d. In addition the loan is also secured by long-term tangible
and intangible assets of obligors. The loan has a super-priority status as provided for in the Law on
extraordinary administration proceeding in companies of systemic importance for the Republic of Croatia and
allows for the refinancing of debt incurred prior to entering into the extraordinary administration applying 1:1
ratio between new money and refinanced debt.
On 10 March 2017 the Company signed a contract with Agrokor Investments B.V. Agreement for the sale and
purchase of the shares in Poslovni sistem Mercator d.d., whereby the Company acquired an additional 615,384
shares in Poslovni sistem Mercator d.d. for the total consideration of EUR 39,999,960, increasing its overall
shareholding to 69.57%.
As of 30 January 2017 the Company transferred total of 51% of shares (29,830 shares) of the company
Agrolaguna d.d. to Agram Invest d.o.o. based on the Frame agreement on repurchase of securities from 20
February 2012. Total consideration amounted to HRK 35 million and through this transaction the Company lost
control over Agrolaguna d.d. During the process of extraordinary administration, the basis for such transaction
is being examined and as of 9 June 2017, the extraordinary administration initiated court proceedings with the
main purpose to determine this transaction as null and void.
In Febraury 2017 assets of the Company (corporate building) has been pledged as collateral for liabilities of one
Group company in total amount of EUR 8.7million. During the process of extraordinary administration, the
basis for such transaction is being examined and as of 9 June 2017, extraordinary administration initiated court
proceeding with the main purpose to determine this transaction as null and void.
In August 2017 the Company's bonds have been delisted from the Irish Stock Exchange.
56
Agrokor d.d.
34. Events after the balance sheet date (continued)
Extraordinary Administration Procedure

On 10th April 2017, the Company with its affiliated and controlled companies entered the Extraordinary
Administration Procedure (“Extraordinary Administration”) in accordance with the Law on extraordinary
administration proceeding in companies of systemic importance for the Republic of Croatia (Official Gazette no
31/17, “Law”). Per the Extraordinary Administration, the court appointed Extraordinary Administrator who
took over the functions of the Company’s corporate bodies, including the management of the Company. The
Extraordinary Administration effects, among other, are the prohibition of initiating litigation, enforcement and
other proceedings during and until termination of the Extraordinary Administration. Creditors’ claims incurred
before the Extraordinary Administration has opened, are subject to filing and settlement. Extraordinary
Administration rules regulate payment of claims during the Extraordinary Administration. The temporary
Creditors Council is established, which receives reports on the state of the Company and its affiliated and
controlled companies, and is asked for consent as proscribed by the Law. After claims’ publication, a
permanent Creditors Council will be established, which will participate in the preparation of the settlement
proposal. Under the Extraordinary Administration, one uniform collective settlement proposal will be
presented for creditors’ voting, encompassing the Company and its affiliated and controlled companies and
their creditors, providing for the settlement of claims and the restructuring of the Company and its affiliated
and controlled companies under the Extraordinary Administration. Extraordinary Administration terminates
upon performance of the settlement.
Significant court proceedings against the Company

As stated above, the Law prescribes a prohibition or freeze of all proceedings in Croatia against the Company
and its affiliated and controlled companies subject to Extraordinary Administration. Therefore no proceedings
have been initiated or continued during the Extraordinary Administration in Croatia. Requests for Extraordinary
Administration recognition have been filed in UK, Slovenia, Serbia, Montenegro and Bosnia and Herzegovina,
for the prohibition or stay of proceedings to take effect in those jurisdictions. Pending the final decision in
these recognition proceedings, several proceedings have been initiated in those jurisdictions. In England,
Sberbank of Russia has initiated two arbitration proceedings for non-payment of EUR 100 million and EUR 350
million term loan facility agreements. Both arbitration proceedings are stayed pending the outcome of the
recognition proceedings. In Slovenia, an enforcement proceeding and a petition for a temporary injunction
have been filed. In Serbia, twelve enforcement or temporary injunction proceedings and one litigation have
been initiated. One petition for a temporary injunction has been filed in Bosnia and Herzegovina and one
enforcement action has been initiated in Montenegro.
57

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Agrokor d.d.

STATEMENT OF THE RESPONSIBILITY OF THE EXTRAORDINARY COMMISSIONER 2

INDEPENDENT AUDITOR´S REPORT 5

NOTES TO FINANCIAL STATEMENTS 14-57

Responsibility of the Extraordinary Commissioner for financiai statements

• suitable accounting policies are selected and then applied consistently;

• judgements and estimates are reasonable and prudent;

Our Qualified Opinion

Basis for Qualified Opinion

Material Uncertainty Relating to Going Concern

Materiality  Overall materiality for the separate financial statements as a whole:

Key audit matter  Impairment of loans, trade and other receivables

How we tailored our audit scope

Approximately 0.7% of total assets.

Key audit matters

How our audit addressed the Key audit

Responsibilities of management and those charged with governance for the

Auditor’s responsibilities for the audit of the separate financial statements

Cost of energy and materials 5 (12,686) (8,028)

Financiai income 10 1,175,108 1,348,600

Share in result of associates 16 7,975 (3,799)

Loss before taxation (10,835,242) (1,307,063)

Approved on behalf of the Company on 9 October 2017 by:

NET LOSSFORTHEYEAR (10,835,242) (1,307,063)

Other comprehensive income

Other comprehensive income to be reclassified as profit or

Net change in cash flow hedging 12 26,516

Net change on financial assets available for sale 12 (12,439) 10,034

Other comprehensive income, net (12,439) 35,931

Approved on behalf of the Company on 9 October 2017 by:

TOTAL ASSETS 15,413,492 25,472,198 22,834,876

TOTAL LIABILITIES AND EQUITY 15,413,492 25,472,198 22,834,876

TOTAL NET CASH FLOW (29,301) 26,859

1. Todorić Ivan Chairman from 29.06.2016 until 10.04.2017

1. Todorić Ivica President from 26.05.2016 until 10.04.2017

2. Summary of significant accounting policies

2.1. Basis for the preparation of financial statements

2.2. Going Concern Assumption

2.2 Going Concern Assumption (continued)

2.3. Significant accounting policies

2.3.2. Classification of short-term against long-term

All other liabilities are considered as long-term.

2.3.3. Financial instruments

Effective interest method (EIR)

Financial assets at fair value through profit or loss

2.3. Significant accounting policies (continued)

Available-for-sale financial investments

Loans and receivables

2.3. Significant accounting policies (continued)

Impairment of financial assets

Financial liabilities and equity instruments

Classification as debt or equity

Financial liabilities at fair value through profit or loss

2.3. Significant accounting policies (continued)

Financial guarantee contracts

Derecognition of financial liabilities

Offsetting of financial instruments

2.3.4. Fair value measurement

2.3. Significant accounting policies (continued)

2.3.5. Investments in subsidiaries

2.3.6. Investments in Associates and Joint Ventures

2.3. Significant accounting policies (continued)