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Sazka-As-Annual-Report-2016-En.Pdf TABLE OF CONTENTS TABLE OF CONTENTS ......................................................................................................................................................................................... 2 IDENTIFICATION DETAILS ................................................................................................................................................................................. 3 COMPANY PROFILE ............................................................................................................................................................................................ 4 SUMMARY OF MAJOR EVENTS OF 2016 ...................................................................................................................................................... 6 TOP MANAGEMENT ............................................................................................................................................................................................ 8 HUMAN RESOURCES .......................................................................................................................................................................................... 9 PROPERTY INTERESTS (AS OF 31 December 2016) .............................................................................................................................. 10 REPORT OF THE BOARD OF DIRECTORS ON BUSINESS ACTIVITIES AND THE STATE OF THE COMPANY ASSETS IN 2016 ....................................................................................................................................................................................................................... 11 REPORT OF THE BOARD OF DIRECTORS OF SAZKA A.S. ON RELATIONSHIPS BETWEEN THE CONTROLLING AND CONTROLLED ENTITIES, AND RELATIONSHIPS BETWEEN THE CONTROLLED ENTITY AND ENTITIES CONTROLLED BY THE SAME CONTROLLING ENTITY .............................................................................................................................................................. 13 ANNEX: LIST OF RELATED PARTIES ............................................................................................................................................................ 16 FINANCIAL STATEMENTS ............................................................................................................................................................................... 22 Annex to financial statements – Table of contents ....................................................................................................................... 27 General information on the Company ............................................................................................................................................... 28 Bases for the compilation of the financial statements ................................................................................................................. 30 Important accounting procedures ...................................................................................................................................................... 34 Determination of fair value .................................................................................................................................................................... 43 Revenues ....................................................................................................................................................................................................... 44 Cost of sale .................................................................................................................................................................................................... 44 Operating costs ........................................................................................................................................................................................... 46 Remuneration of statutory auditors Financial revenues and costs Income tax .................................................................. 47 Intangible assets and goodwill ............................................................................................................................................................. 49 Fixed assets .................................................................................................................................................................................................. 51 Assets earmarked for sale Investments in enterprises with decisive influence .................................................................. 53 Other long-term financial investments .............................................................................................................................................. 54 Deferred tax assets and liabilities ......................................................................................................................................................... 55 Trade receivables and other assets ..................................................................................................................................................... 56 Short-term receivables from financial instruments ....................................................................................................................... 56 Cash and cash equivalents ..................................................................................................................................................................... 57 Equity .............................................................................................................................................................................................................. 57 Trade payables and other payables .................................................................................................................................................... 62 Provisions (in Czech: rezervy) ................................................................................................................................................................ 63 Contingent payables ................................................................................................................................................................................. 64 Procedures in risk management and disclosure of information ............................................................................................... 64 Affiliates ......................................................................................................................................................................................................... 71 Subsequent events .................................................................................................................................................................................... 74 │ SAZKA a.s. │ ANNUAL REPORT 2016 │ 2 IDENTIFICATION DETAILS SAZKA a.s. Registered office: Prague 9, K Žižkovu 851, Postal Code 190 93 Id. No: 26493993 Tax Id. No.: CZ699003312 Registration in the Register kept by the Municipal Court in Prague, Section B, File 7424 Objects of business: manufacture, trade and services not included in Annexes 1 to 3 to the Trade Act; operation of lotteries and other similar games in accordance with the generally binding legal regulations; assembly, repairs, revisions and tests of electrical equipment; manufacture, installation, repairs of electrical machines and instruments, electronic and telecommunication facilities; activities of accounting consultants, keeping of accounts, keeping of tax records; management of the filing service; performance of communication activities pursuant to Act No. 127/2005 Coll., on electronic communications and on amendment to certain related laws, constituting operation of a business in electronic communications; provision of small-scale payments services pursuant to Act No. 284/2009 Coll., on payment systems, as amended. Objects of activities: lease of real estate, flats and non-residential premises. | SAZKA a.s. | ANNUAL REPORT 2016 | 3 COMPANY PROFILE SAZKA a.s. (hereinafter also referred to as the “Company”) is a member of the KKCG multinational investment group operating in 11 countries on 4 continents. The Company is based in the Czech Republic and was established under the Czech laws. SAZKA is the Czech Republic’s oldest lottery company. The Company’s key lottery products include number lotteries, with Sportka being its best-known game. In addition to number lotteries, the Company’s product portfolio includes scratch tickets and sports betting. Another pillar consists of non-lottery products, primarily based on the services of the SAZKAmobil mobile operator, on topping up pay-as-you-go mobile phones and selling tickets for events. The Company provides its products in particular through a unique sales network with more than seven thousand points of sale scattered across the Czech Republic. The Company is a fully-fledged member of the European Lotteries (EL) and the World Lottery Association (WLA) – the biggest and most influential international organisations. The Company embraces and promotes the principles of responsible gaming and ethical principles in the betting and lottery industry. The Company develops and endorses these activities on both national and international levels. The Company performs no activities in the area of research and development.
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