146 Vodafone Group Plc Annual Report 2026
Strategic report
Governance
Financials
Other information
The main impacts of the aforementioned adjustments for the Group’s Turkish and Ethiopian operations (in prior years only) on the consolidated financial statements are shown below. Increase/(decrease) 2026 2025 2024 €m €m €m Impact on the consolidated income statement for the years ended 31 March Revenue 185 88 111 Operating (loss)/profit 1 (338) (287) 66 Loss for the financial year 1 (428) (449) (169) Increase 2026 2025 2024 €m €m €m Impact on the consolidated statement of financial position at 31 March Net assets 895 1,029 981 Equity attributable to owners of the parent 895 987 913 Non-controlling interests – 41 68 Note: 1. Includes €77 million gain on the net monetary assets/liabilities (2025: €112 million gain; 2024: €360 million gain). Foreign currencies The consolidated financial statements are presented in euro, which is also the Company’s functional currency. Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency. With the exception of the Group’s Turkish lira operations which are subject to hyperinflation accounting (see above), transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates prevailing on the reporting period date. Non- monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the valuation date. Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated. Share capital, share premium and other capital reserves are initially recorded at the functional currency rate prevailing at the date of the transaction and are not retranslated. For the purpose of presenting consolidated financial statements, the assets and liabilities of entities with a functional currency other than euro are expressed in euro using exchange rates prevailing at the reporting period date.
1. Basis of preparation (continued) Significant accounting policies applied in the current reporting period that relate to the consolidated financial statements as a whole Accounting convention The consolidated financial statements are prepared on a historical cost basis except for certain financial and equity instruments that have been measured at fair value and for the application of IAS 29 ‘Financial Reporting in Hyperinflationary Economies’ for the Group’s entities reporting in Turkish lira and its associate’s reporting in The consolidated financial statements incorporate the financial statements of the Company, subsidiaries controlled by the Company (see note 31 ‘Related undertakings’ to the consolidated financial statements), joint operations that are subject to joint control and the results of joint ventures and associates (see note 12 ‘Associates and joint arrangements’ to the consolidated financial statements). Hyperinflationary economies Ethiopian birr (see below). Basis of consolidation The Turkish economy was designated as hyperinflationary from 30 June 2022. The Ethiopian economy was designated as hyperinflationary from 31 December 2022 until 31 March 2025. The Group has applied IAS 29 ‘Financial Reporting in Hyperinflationary Economies’ to its Turkish operations whose functional currency is Turkish lira, from 1 April 2022, and to the Ethiopian operations, whose functional currency is Ethiopian Birr, from 1 April 2022 until 31 March 2025. Comparative amounts are not restated. In applying IAS 29 to the Group’s operations in Türkiye, the Turkish lira results and non-monetary asset and liability balances for relevant financial years have been revalued to their present value equivalent local currency amounts at the reporting date, based on the consumer price indexes issued by the Turkish Statistical Institute. The Turkish index has risen by 30.9% (2025: 38.1%; 2024: 68.5%) during this financial year. The revalued balances are translated to euros at the reporting date exchange rate of €1: 51.25 TRL (2025: €1: 41.00 TRL; 2024: €1: 34.94 TRL) respectively applying IAS 21. For the Group’s operations in Türkiye: − The gain or loss on the revaluation of net monetary assets resulting from IAS 29 application is recognised in the consolidated income statement within Other (expense)/income. − The Group also presents the gain or loss on cash and cash equivalents as monetary items together with the effect of inflation on operating, investing and financing cash flows as one number in the consolidated statement of cash flows. − The Group has presented the equity revaluation effects and the impact of currency movements within other comprehensive income as such amounts are judged to meet the definition of ‘exchange differences’.
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