2021 Universal Registration Document

5 2021 CONSOLIDATED FINANCIAL STATEMENTS Notes to the consolidated financial statements

Level 1: Quoted data: 0%; p Level 2: Observable data: 100%; p Level 3: Internal models: 0%. p

Foreign currency risk hedging mainly relates to transaction exposures involving the Group’s production platforms in India, Poland and Tunisia, and certain commercial contracts denominated in US dollars and in Norwegian kroner. These hedges cover both invoiced items and future cash flows: changes in fair value corresponding to these hedges are taken to profit or loss for invoiced items and to equity for future cash flows. The remeasurement through profit or loss of these financial instruments hedging balance sheet items is offset by the revaluation of foreign currency receivables over the period. The Group’s Finance Department provides hedging via futures or options entered into either on organised markets or over the counter with top-tier counterparties that are members of the banking syndicate. The Group’s policy is not to conduct speculative transactions on financial markets. Finally, the structure of the Group’s net financial debt, which includes a multi-currency notional cash pooling arrangement with borrowing positions in pounds sterling, provides a natural (if only partial) hedge against currency translation risk on net assets, recognised directly in the balance sheet. The balance sheet value of the Group’s foreign currency hedging instruments, and applicable notional amounts hedged, are as follows:

Foreign currency risk 12.5.4. The Group is subject to three main types of risks linked to fluctuations in exchange rates: translation risk in the various financial statements making up the p Group’s consolidated financial statements for business conducted in countries with a functional currency other than the euro; transaction risk linked to purchases and sales of services, where p the transaction currency is different from that of the country in which the service is recognised; financial foreign currency risk arising from the Group’s p foreign-currency borrowings (risk arising from changes in the value of the financial debt denominated in pounds sterling). As part of its general risk management policy, the Group systematically hedges against foreign currency transaction risks that constitute material risks for the Group as a whole. Centralised management of foreign currency transaction risk is in place with the Group’s main entities (apart from India). Sopra Steria Group acts as the centralising entity, granting exchange rate guarantees to subsidiaries and, after netting internal exposures, hedges the residual exposure through the use of derivatives.

Fair value

31/12/2021

Maturity

Non- current liabilities

Non- current assets

Current liabilities

1 to 5 years >5 years

Current assets

Notional amount

<1 year

(in millions of euros)

Fair value hedges Foreign currency forwards Foreign currency options Cash flow hedges Foreign currency forwards Foreign currency options

- -

3.8

- -

0.1

74.8

74.8

- -

- -

-

-

-

-

2.2

1.5 0.1

0.2 0.1

0.5 0.2

113.2

56.9 11.2

56.3

- -

-

14.5

3.3

Instruments not designated for hedging* TOTAL FOREIGN CURRENCY HEDGES

-

-

-

0.1

5.9

5.9

-

-

2.3

5.4

0.3

0.9 208.4 148.8

59.6

-

The Group hedges the foreign exchange transaction risk but chooses in certain cases not to apply hedge accounting. *

The remeasurement of these financial instruments in profit or loss is recognised in Other current operating income and expenses , with the exception of the time value and the impact of financial instruments not eligible for hedge accounting, which are recognised in Other financial income and expenses.

219

SOPRA STERIA UNIVERSAL REGISTRATION DOCUMENT 2021

Made with FlippingBook - Online catalogs