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From Private Equity Investor to Conglomerate: The Finnish KH Group Has Undergone a Unique IFRS Reporting Conversion

As a result of a strategic change, KH Group, formerly Sievi Capital, became one of the first listed companies to convert from reporting as an investment entity to reporting as a conglomerate under IFRS Standards. This historic transformation occurred in summer 2023. Due to the limited availability of material and guidance on converting under IFRS Standards at the time, our project team had to develop pioneering but well-founded solutions within the IFRS reporting framework.    

Initially, only one of the group’s five portfolio companies applied IFRS Standards in its reporting. However, following the strategy change, the other four companies also had to make a shift to using those same standards. While the portfolio companies could see the benefits of uniform reporting and consolidation, there was apprehension over the additional workload the conversion would require. This would be no easy task.  

A Project Team of Economic Experts  

NIS was commissioned to assemble a project team for this challenging task. It chose to collaborate with Backo, a partner organization focused on IFRS services. A team of project consultants was selected, all of whom have extensive expertise in the financial management of listed companies or have held various roles in auditing firms. The four-member team consisted of Ville Nikulainen and Anssi Airaksinen from NIS and Ville Jakonen and Sakari Valjakka from Backo. They worked as one team with the client. 


Key contacts in the conversion project naturally also included the then Sievi Capital financial and group management teams, as well as the financial management for each business area. The project team consulted representatives of all five portfolio companies from the outset of the process. This helped with the management of the project overall and improved communication between the companies. 


“To start reporting as a conglomerate, we had set a deadline based on the next quarterly reporting date following our Annual General Meeting. Successfully completing the project meant keeping to the set schedule and overall budget. High quality standards are, of course, a minimum requirement for a listed company,” says Ville Nikulainen with regard to project requirements. 


As our conglomerate IFRS reporting project included many firsts, we worked closely with an auditing firm to ensure a successful transition. We prepared the various elements related to the IFRS conversion ahead of time so that the auditors were able to approve the reporting documentation well in advance of the quarterly report publication date. 

Reasonable Checklist 


The conversion initially sounded like it would be a highly demanding undertaking, however the extra work required in practical terms ended up being quite manageable.   

“We had to efficiently prioritize within the project and did not try to squeeze every single reporting change into our tight project schedule. We happily left some of the tasks for the financial statement phase,” says Anssi Airaksinen

Backo’s Ville Jakonen and Sakari Valjakka agree on the importance of prioritizing during a major conversion project. They also wanted to highlight some of the other key ingredients for success: “For this unique project, we really relied on our economic management specialists, who apply a business mindset. We also needed a solution-oriented approach and frictionless cooperation. On top of these, there was a hefty dose of planning, hard work and the ability to ask for help before it’s too late.” 


Now that the conversion project has been completed, the parent company has hired a Group Financial Controller who will use the project team’s guidelines in their daily work.

KH Group is a conglomerate, and our businesses are leading players across our four areas of operation, both in B2B products and in services and consumer trade. The objective of our strategy change for 2023 is to focus on the business of the earth-moving machinery supplier KH-Koneet. KH Group’s shares are listed on Nasdaq Helsinki. 




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