Airbus - Financial Statements 2022

2. Notes to the IFRS Consolidated Financial Statements Capital Structure and Financial Instruments

Lease liabilities The maturity analysis of lease liabilities, based on contractual undiscounted cash flows is as follows:

31 December

2022

2021

(In € million)

Not later than one year

(241)

(245)

Later than one year and not later than five years

(747)

(758)

Later than five years

(1,036)

(1,043)

Total undiscounted lease liabilities

(2,024)

(2,046)

(1,734)

(1,736)

Lease liabilities included in the statement of financial position

Current

(242)

(245)

Non ‑ current

(1,492)

(1,491)

Credit Risk The Company is exposed to credit risk to the extent of non ‑ performance by either its customers ( e.g. airlines) or its counterparts with regard to financial instruments or issuers of financial instruments for gross cash investments. However, it has policies in place to avoid concentrations of credit risk and to ensure that credit risk is limited. As far as central treasury activities are concerned, credit risk resulting from financial instruments is managed by the Company. In order to ensure sufficient diversification, a credit limit system is used. The Company monitors the performance of the individual financial instruments and the impact of market developments on their performance and takes appropriate action on foreseeable adverse development based on pre ‑ defined procedures and escalation levels. Sales of products and services are made to customers after Financial instruments — The Company’s financial assets mainly consist of cash, short to medium ‑ term deposits and securities. Its financial liabilities include trade liabilities, obligations towards financial institutions, issued bonds and refundable advances from European Governments. All purchases and sales of financial assets are recognised on the settlement date according to market conventions. Financial assets at amortised cost — This category comprises assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest. It includes trade receivables. Financial assets at fair value through OCI — This category comprises: equity investments that are not held for trading. With the exception of dividends received, the associated gains and losses (including any related foreign exchange component) are recognised in OCI. Amounts presented in OCI are not subsequently transferred to profit or loss on derecognition of the equity investment nor in the event of an impairment; (i)

having conducted appropriate internal credit risk assessment. In order to support sales, primarily at Airbus, Airbus Helicopters and ATR, the Company may agree to participate in customer financing, on a case ‑ by ‑ case basis either directly or through guarantees provided to third parties. In determining the amount and terms of the financing transaction, the Company takes into account the airline’s credit rating and economic factors reflecting the relevant financial market conditions, together with appropriate assumptions as to the anticipated future value of the financed asset. The booked amount of financial assets represents the maximum credit exposure. The credit quality of financial assets can be assessed by reference to external credit rating (if available) or internal assessment of customers’ creditworthiness e.g. airlines by way of internal risk pricing methods. For further information relating to gross credit risk and impairment see “– Note 38.7: Impairment Losses”. debt instruments where contractual cash flows are solely payments of principal and interest, and that are held both for sales and collecting contractual cash flows. Changes in their fair value other than impairment losses and foreign exchange gains and losses on monetary items are recognised directly within AOCI. Upon disposal of such financial assets, the cumulative gain or loss previously recognised in equity is recorded as part of other income (other expenses) from investments in the Consolidated Income Statement for the period. Interest earned on the investment are presented as interest income in the Consolidated Income Statement using the effective interest method. Dividends earned on investment were recognised as other income (other expenses) from investments in the Consolidated Income Statement when the right to the payment had been established. (ii)

38.2 Carrying Amounts and Fair Values of Financial Instruments

77