1.3 Estimates and judgements by management
Hydratec makes use of estimates and assumptions when preparing the financial statements and the measurement of items in the financial statements. These are mainly based on knowledge of the various business segments, past experience and Hydratec’s management’s best estimate of the specific circumstances that are, in the opinion of management, applicable in the given situation. This estimate takes into account the macroeconomic and geopolitical effects (including sustainability). The further explanation of the sustainability statement, including the strategy, targets and metrics described therein, does not lead to any change in the assumptions and estimates, unless otherwise explained in the relevant item of the financial statements. The assumptions and estimates used in the financial statements often relate to future developments based on long-term planning. Actual developments may differ from the assumptions made and therefore the actual outcome may differ significantly from the current measurement of a number of items in the financial statements. Consequently, the assumptions and estimates used may have a significant impact on equity and the results. The assumptions and estimates used are checked regularly, including in part, and adjusted if necessary. The following items in Hydratec’s financial statements are specifically subject to assumptions and estimates:
the identification and measurement of intangible fixed assets on acquisitions and purchase of participations and impairment tests;
the valuation of tangible fixed assets and determination of economic life on acquisitions and purchase of participations;
the measurement of inventories at various stages;
the measurement of deductible losses for tax purposes;
the determination of provisions;
financial instruments;
identification and determination of segments;
revenue recognised and measured for contract assets/liabilities.
Estimates and uncertainties relating to these items are described in the notes to the individual items in the financial statements. Apart from the elements set out in the notes to the financial statements, there are no other critical measurement estimates which required further explanation.
The management report as referred to in Part 9 of Book 2 of the Dutch Civil Code monitors the elements from the foreword to the historical summary inclusive. This version of the annual financial reporting of Hydratec Industries N.V. for the financial year ending on 31 December 2025 is not presented in the ESEF format as specified in the regulatory technical standards for ESEF (Delegated Regulation (EU) 2019/815). The set of ESEF reports can be downloaded at the download page.