MERLIN PROPERTIES SOCIMI, S.A. ANNUAL

Business / Consolidation

2.6Basis of consolidation applied All companies over which effective control is exercised by virtue of holding a majority of the voting rights in their representation and decision-making bodies and the power to determine the company's financial and operational policies were fully consolidated; and companies in which the Group owns more than a 20% interest and exercises significant influence without holding a majority of the voting rights were accounted for using the equity method (see Note 9). Likewise,a significant influence on the investments held by the Group with a participation rate of less than 20% is considered to exist if it has representation on the Board of these companies of the parties related to it. A number of adjustments have been made to align the accounting principles and measurement bases of Group companies with those of the Parent, including the application of International Financial Reporting Standards measurement bases to all Group companies and associates. It was not necessary to unify accounting periods since the balance sheet date of all the Group companies and associates is 31 December of each year.