Areva - Reference Document 2016

20

20.2 Notes to the consolidated financial statements for the year ended December 31, 2016 FINANCIAL INFORMATION CONCERNING ASSETS, FINANCIAL POSITION AND FINANCIAL PERFORMANCE

NOTE 10. GOODWILL

Continuing operations

Currency translation adjustments and other

December 31,

Operations held for sale

December 31, 2016

(in millions of euros)

2015 Increase Disposals Impairment

Mining

883 161 228

30

(913) (161) (228)

Front End (Chemistry, Enrichment)

Back End

TOTAL

1,272

30

(1,303)

Operations held for sale

(in millions of euros)

December 31, 2016 December 31, 2015

Operations held for sale in 2015 New NP

2,337

2,337

AREVA TA

29

31

Nuclear Measurements

-

100

Sub-total

2,366

2,468

Operations held for sale in 2016 NewCo

1,303 3,669

TOTAL (*) * see note 3.

2,468

GOODWILL IMPAIRMENT TESTS As indicated in notes 1.2. Estimates and judgments and 1.3.9. Impairment of property, plant and equipment, intangible assets and goodwill , the group performs asset impairment tests based on its best estimate of their recoverable value, which corresponds to the higher of their net realizable value or their estimated value in use, based on projected cash flows resulting from the budget, mining plans and the assumptions they contain.

These tests consist of comparing the net carrying amount of the assets of cash generating units (after inclusion of write-downs of property, plant and equipment and intangible assets listed in notes 11 and 12) to their recoverable amount. The discount rates used for these tests are based on the calculation of the average cost of capital for each operating segment. They are calculated using observed market data and evaluations prepared by specialized firms (10-year risk-free rates, risk premiums on equity markets, volatility indices, credit spreads and debt ratios of comparable businesses in each segment).

The following assumptions were used to determine the net present value of the cash flows to be generated by the CGUs:

Growth rate of pro forma year

December 31, 2016

After tax discount rate

Final year

Mining

7.50%-12.00%

n/a n/a

2070 2070 2026

Front End (Chemistry, Enrichment)

6.70%

Back End

6.40%-6.70%

1.75%

Growth rate of pro forma year

December 31, 2015

After tax discount rate

Final year

Mining

9.50% 6.50% 4.50%

Na

2070 2025 2025

Front End (Chemistry, Enrichment)

1.75% 1.75%

Back End

These impairment tests were calculated using exchange rates in effect on the balance sheet date.

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2016 AREVA REFERENCE DOCUMENT