Compagnies des Alpes // 2019 Universal Registration Document

5 FINANCIAL INFORMATION

Consolidated financial statements

5.3.2 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

C NTENT

NOTE 1 ACCOUNTING PRINCIPLES AND POLICIES

130

NOTE 5 INFORMATION ON THE CONSOLIDATED INCOME STATEMENT

142

NOTE 2 MANAGEMENT OF CAPITAL AND RISKS

138

NOTE 6 INFORMATION ON THE CONSOLIDATED BALANCE SHEET

145

NOTE 3 ORGANISATIONAL STRUCTURE OF THE COMPAGNIE DES ALPES GROUP

140

NOTE 7 INFORMATION ON THE STATEMENT OF CASH FLOWS

160

NOTE 4 SCOPE OF CONSOLIDATION

140

NOTE 8 OTHER DISCLOSURES

161

Group overview The Compagnie des Alpes Group’s main business activity is the operation of leisure facilities. It operates mainly in Ski areas and Leisure parks. The Group’s parent company is Compagnie des Alpes, whose headquarters are located at 50-52 boulevard Haussmann, 75009 Paris.

The full-year 2018/2019 consolidated financial statements were approved by the Board of Directors on 9 December 2019, which authorised their publication. Figures are in thousands of euros, unless otherwise indicated.

Note 1

Accounting principles and policies

The main accounting policies applied in the preparation of the consolidated fi nancial statements are outlined below. Unless otherwise indicated, they are applied consistently across all reporting periods presented. In application of EU regulation 1606/2002 of 19 July 2002 on international accounting standards, the annual consolidated fi nancial statements of the Compagnie des Alpes Group for the reporting period ended 30 September 2019 were drawn up in conformity with the international fi nancial reporting standards (IAS/IFRS), as adopted by the European Union at 30 September 2019, and in accordance with the historical cost convention, with the exception of certain fi nancial assets and liabilities, which were valued at their fair value, as required under IFRS. The standards whose application is mandatory from 1 October 2018 did not have a signi fi cant impact on the Group’s consolidated fi nancial statements. l Application of IFRS 15 “Revenue from contracts with customers” The IFRS 15 standard on recognition of revenue is applicable, for the Compagnie des Alpes Group, at 30 September 2019. It does not have a signi fi cant impact on the Group’s consolidated fi nancial statements. l Application of IFRS 9 “Financial instruments” IFRS 9 replaces IAS 39 “Financial instruments: accounting and evaluation”. IFRS 9 de fi nes the rules applicable to the classi fi cation and accounting of financial instruments, impairment of financial assets (resorting, notably for the valuation of trade receivables, to an expected loss model replacing the incurred loss model), and to hedge accounting. This standard was been applied retrospectively and in a limited manner, with the exception of hedge accounting, which was applied prospectively as of 1 October 2018.

Classification and evaluation of financial instruments: The retrospective application of the “Classi fi cation and evaluation of fi nancial instruments” component results in the deletion of the “available-for-sale fi nancial assets” category and a reclassi fi cation: l as “financial assets at fair value through other components of comprehensive income”; or l as “ fi nancial assets at fair value through income; l as “non-current fi nancial assets through amortised cost”. The adoption of this standard resulted in an opening adjustment of +€4.8 million without tax e ff ect, which breaks down as follows: l evaluation of financial assets at fair value through income (+€4.1 million); l evaluation of fi nancial assets at fair value through non-recyclable shareholders’ equity (+€0.7 million). Impairment of financial assets IFRS 9 requires the recognition of expected credit losses on trade receivables. The Group applied the simpli fi ed approach to the standard and calculated impairments based on the history of the Group’s credit losses. The adoption of the standard resulted in an increase in the impairment of assets of €0.3 million before tax e ff ect and an adjustment in shareholders’ equity. Hedge accounting The Group has chosen to adopt the new IFRS 9 provisions in hedge accounting as of 1 October, prospectively. The standard had no impact on the previously chosen hedging relationships. The e ff ects of applying the standard are linked to the change in the method of accounting for the cost of the hedges (changes in value linked to forward points of futures contracts and the time value of options).

130

Compagnie des Alpes I 2019 Universal registration document