BPCE - 2020 Universal Registration Document

FINANCIAL REPORT

BPCE PARENT COMPANY ANNUAL FINANCIAL STATEMENTS

ACCRUAL ACCOUNTS

4.8

12/31/2020

12/31/2019

Assets

Liabilities

Assets

Liabilities

in millions of euros

0

224 230

468 309 259

0

Foreign exchange commitments

Deferred gains and losses on hedging forward financial instruments

187 245

230

Issue premiums and expenses

19 20

15 21

Prepaid expenses and unearned income

18

19

Accrued income/expenses* Items in process of collection

822

288

1,118

406

0

27

0

13

Other

223

111 919

62

168 853

TOTAL

1,495

2,235

Including €770 million in accrued interest receivable on interest rate swaps and €163 million in accrued interest payable on interest rate swaps. *

4.9

PROVISIONS

Accounting principles This item includes provisions set up to cover contingencies and losses that are clearly identifiablebut of uncertain timing or amount, that are either directly related or unrelated to banking transactions as defined under Article L. 311-1of the French Monetary and Financial Code or related transactions defined under Article L. 311-2 of the same Code. Unless covered by a specific text, such provisions may only be recognizedif the companyhas an obligationto a third party at the end of the fiscal year and no equivalent consideration is expected in return, in accordance with ANC Regulation No. 2014-03. In particular, this item includes a provision for employee benefitsand a provisionfor counterpartyrisk on guaranteeand loan commitments given. Employee benefits Short-term employee benefits mainly include wages, paid annual leave, incentive schemes, profit-sharing, and bonuses payable within 12 months of the end of the period in which the employee renders the service. They are recognizedas an expense for the period, including amounts remaining due at the balance sheet date. Long-term employee benefits Long-term employeebenefits are generally linked to seniority accruing to current employees and payable 12 months or more after the end of the period in which the employee renders the related service. These consist mainly of long-service awards.A provisionis set aside for the amount of these obligations at the balance sheet date. The obligations are valued using an actuarial method that takes account of demographicand financial assumptionssuch as age, length of service, the likelihoodof the employeebeing employed by the Group at retirement and the discount rate. The valuationalso allocatescosts over the working life of each employee (projected unit credit method).

Termination benefits Termination benefitsare granted to employeeson termination of their employment contract before the normal retirement date, either as a result of a decisionby the Group to terminate a contract or a decision by an employee to accept voluntary redundancy.A provision is set aside for terminationbenefits. Termination benefits payable more than 12 months after the balance sheet date are discounted to present value. Post-employment benefits Post-employment benefits include lump-sum retirement bonuses, pensions and other post-employment benefits. These benefits can be broken down into two categories: defined-contribution plans, which do not give rise to an obligation for the Group, and defined-benefitplans, which give rise to an obligationfor the Group and are thereforemeasured and recognized by means of a provision. The Group records a provision in liabilities for employee benefit obligations that are not funded by contributions charged to income and paid out to pension funds or insurance companies. Post-employment benefits are measured in the same way as long-term employee benefits. The measurement of these obligations takes into considerationthe value of plan assets as well as unrecognized actuarial gains and losses. Actuarial gains and losses on post-employment benefits, arising from changes in actuarial assumptions (early retirement, discount rate, etc. ) or experience adjustments (return on plan assets, etc. ), are amortized under the corridor method, i.e. for the portion exceedinga variationof +/-10%of the defined-benefit obligation or the fair value of plan assets. The annual expense recognized in respect of defined-benefit plans includes the current service cost, net interest cost (the effect of discounting the obligation) less hedging assets, and the amortizationof any unrecognized items that are actuarial gains or losses.

5

563

UNIVERSAL REGISTRATION DOCUMENT 2020 | GROUPE BPCE