Airbus - Financial Statements 2022

2. Notes to the IFRS Consolidated Financial Statements Basis of Preparation

Legal contingencies — The Company is party to litigations related to a number of matters as described in “– Note 39: Litigation and Claims”. The outcome of these matters may have a material effect on the Financial Position, results of operations or cash flows of the Company. Management regularly analyses current information concerning these matters and provides provisions for probable cash outflows, including the estimate of legal expenses to resolve the matters. Internal and external lawyers are used for these assessments. In making the decision regarding the need for provisions, management considers the degree of probability of an unfavourable outcome and the ability to make a sufficiently reliable estimate of the amount of loss. The filing of a suit or formal assertion of a claim against the Airbus companies or the disclosure of any such suit or assertion, does not automatically indicate that a provision may be appropriate. Income taxes — The Company operates and earns income in numerous countries and is subject to changing tax laws in multiple jurisdictions within these countries. Significant judgements are necessary in determining the worldwide income tax liabilities. Although management believes that it has made reasonable estimates about the final outcome of tax uncertainties, no assurance can be given that the final tax outcome of these matters will be consistent with what is reflected in the historical income tax provisions. At each end of the reporting period, the Company assesses whether the

realisation of future tax benefits is probable to recognise deferred tax assets. This assessment requires the exercise of judgement on the part of management with respect to, among other things, benefits that could be realised from available tax strategies and future taxable income, as well as other positive and negative factors. The recorded amount of total deferred tax assets could be reduced, through valuation allowances recognition, if estimates of projected future taxable income and benefits from available tax strategies are lowered, or if changes in current tax regulations are enacted that impose restrictions on the timing or extent of the Company’s ability to utilise future tax benefits. The basis for the recoverability test of deferred tax assets is the same as the Company’s latest operative planning also taking into account certain qualitative aspects regarding the nature of the temporary differences. Qualitative factors include but are not limited to an entity’s history of planning accuracy, performance records, business model, backlog, existence of long ‑ term contracts as well as the nature of temporary differences (see “– Note 18: Income Taxes”). Other subjects that involve assumptions and estimates are further described in the respective notes (see “– Note 9: Acquisitions and Disposals”, “– Note 20: Intangible Assets” and “– Note 23: Contract Assets, Contract Liabilities and Trade Receivables, and Trade Liabilities”).

6.

Change in Accounting Policies and Disclosures

The accounting policies applied by the Company in preparation of its 2022 year ‑ end Consolidated Financial Statements are the same as applied for the previous year. Other than that, amendments, improvements to and interpretations of standards effective from 1 January 2022 have no material impact on the Consolidated Financial Statements.

New, Revised or Amended IFRSs Applied from 1 January 2022

Agenda Decision published by the IFRS Interpretation Committee (“IFRS IC”) In April 2021, IFRS IC published an agenda decision, “Configuration or Customisation Costs in a Cloud Computing Arrangement”, which considered how an entity should account for configuration and customisation costs incurred in implementing these service arrangements.

IFRS IC concluded that these costs should be expensed, unless the criteria for recognising a separate asset are met. The Company did not perform significant configuration or customisation on its software ‑ as ‑ a ‑ service contracts. As a consequence, the IFRS IC decision has no significant impact on the Consolidated Financial Statements as of 31 December 2022.

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