The Financial Supervisory Authority of Norway has published the results of its review of Belships ASA’s 2023 financial statements, pointing to several material errors and deficiencies in presentation and/or note disclosures under IFRS 16 Leases, IAS 19 Employee Benefits, IAS 1 Presentation of Financial Statements and other specific standards. Belships has already implemented certain fixes from its third-quarter 2024 interim financial report or has confirmed it will correct the issues in its 2024 annual report. Key findings include missing IFRS 16 disclosures for significant lease contracts that Belships is committed to but that had not yet commenced, including agreements linked to eight newbuild ships in its programme; Finanstilsynet expected qualitative and quantitative disclosures, including a maturity analysis of future cash outflows not reflected in recognised lease liabilities. On employee benefits, the authority found that material compensation arrangements for “ship management” staff, including profit-based bonus arrangements and distributions to employees as silent partners, were not transparently presented, leading to omitted information on payroll costs; Belships indicated total payroll costs for 2023 and 2022 should have been USD 15.3 million and USD 21.0 million, rather than USD 3.8 million and USD 5.3 million as disclosed. The review also covered broader IAS 1 disaggregation and accounting policy disclosure issues, including planned changes to disclose key lease judgements and to reclassify four ships accounted for under IFRS 16.103a to owned ships, with an indicated impact of around USD 80 million on 2023 comparative figures, and IAS 7 cash and cash equivalents note disclosures after Belships confirmed money market fund holdings were included (about USD 74 million at year-end 2023 and USD 42 million at year-end 2022). Finanstilsynet requested that Belships provide a written, concrete explanation of where and how the matters have been remedied in the 2024 annual report, no later than two weeks after that annual report is published, and highlighted that the company should assess its handling of the information under the EU Market Abuse Regulation disclosure rules.
Norwegian Finanstilsynet 2025-02-12
Financial Supervisory Authority of Norway identifies material IFRS disclosure errors in Belships ASA 2023 accounts and requests remediation in 2024 reporting
The Financial Supervisory Authority of Norway reviewed Belships ASA’s 2023 financial statements, identifying material errors in IFRS 16, IAS 19, and IAS 1 disclosures. Key issues included missing lease disclosures for newbuild ships and non-transparent employee benefit presentations, leading to understated payroll costs. Belships has begun addressing these deficiencies and will provide a detailed explanation in its 2024 annual report.