Atos - Registration Document 2016

E Financial

E.4

Consolidated financial statements

If control in a subsidiary is lost, any gain or loss is recognized in net income. Furthermore, if an investment in the entity is retained by the Group, it is re-measured to its fair value and any gain or loss is also recognized in net income.

Intangible assets other than goodwill

business combination as well as internally developed IT solutions. software and customer relationships acquired as part of a Intangible assets other than goodwill consist primarily of software and user rights acquired directly by the Group, To assess whether an internally generated intangible asset meets the criteria for recognition, the Group classifies the generation of the asset into: is incurred. Under IAS 38, no intangible asset arising from research (or from the research phase of an internal project) shall be recognized. Such expenditure is therefore recognized as an expense when it and only if, an entity can demonstrate all of the following: An intangible asset arising from development (or from the development phase of an internal project) shall be recognized if, the technical feasibility of completing the intangible asset so • that it will be available for use or sale; it; its intention to complete the intangible asset and to use or sell • its ability to use or sell the intangible asset; • economic benefits; how the intangible asset will generate probable future • the availability of adequate technical, financial and other • resources to complete the development and to use or sell the intangible asset; and its ability to measure reliably the expenditure attributable to • the intangible asset during its development. Development expenditure refers to IT solutions developed for the group’s own use, to specific implementation projects for capitalized are those attributable to the creation, production and preparation of the asset to be capable of operating in the manner intended by management. analyzed on a case-by-case basis and the only costs which are specific customers or innovative technical solutions made available to a group of customers. Development projects are less accumulated depreciation and any impairment losses. It is amortized on a straight-line basis over a useful life between 3 and 12 years, for which two categories can be identified: Capitalized development expenditure is accounted for at cost standard contract duration; the period of amortization will be between 3 and 7 years, the standard scenario being set at 5 years in line with the activities with a shorter business cycle and contract duration, for internal software development with fast technology serving • a research phase; and • a development phase. •

Goodwill

gain. previously held interest in the acquiree (if any), the excess is recognized immediately in profit or loss as a bargain purchase net of the acquisition-date amounts of the identifiable assets acquired and liabilities assumed exceeds the sum of the consideration transferred, of the amount of any non-controlling interests in the acquiree and of the fair value of the acquirer’s interests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquiree (if any) over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed. If, after reassessment, the Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling Group at which management monitors goodwill. Goodwill is allocated to Cash Generating Units (CGU) for the purpose of impairment testing. Goodwill is allocated to those CGUs that are expected to benefit from synergies of the related business combination and represent the lowest level within the A CGU is defined as the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or group of assets. CGUs correspond to the Worldline activities. geographical areas where the Group has operations – except for value less costs to sell and its value in use determined using the discounted cash-flows method. When this value is less than its carrying amount, an impairment loss is recognized in the operating income. The recoverable value of a CGU is based on the higher of its fair The impairment loss is first recorded as an adjustment of the carrying amount of the goodwill allocated to the CGU and the remainder of the loss, if any, is allocated pro rata to the other long term assets of the unit. The Cash Generating Units used for the impairment test are not larger than operating segments determined in accordance with IFRS 8 Operating segments. Goodwill is not amortized and is subject to an impairment test performed at least annually by comparing its carrying amount to its recoverable amount at the closing date based on December actuals and latest 3 year plan, or more often whenever events or when compared with budget; significant deviance of economic performance of the asset • significant worsening of the asset’s economic environment; • loss of a major client; • significant increase in interest rates. • circumstances indicate that the carrying amount could not be recoverable. Such events and circumstances include but are not limited to:

E

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