EDF / 2018 Reference document

FINANCIAL STATEMENTS Notes to the consolidated financial statements

COMPARABILITY NOTE 2 IFRS 15 – REVENUE FROM 2.1

deliveries in France by non-Group Distribution Network Operators), and a corresponding equal reduction in delivery expenses (included in fuel and energy purchases).

CONTRACTS WITH CUSTOMERS

IFRS 15 “Revenue from Contracts with Customers” became applicable on 1 January 2018 (see note 1.3.7). The Group has applied the full retrospective approach, which has no impact on opening equity. As a result of this change, sales and energy purchases reported at 31 December 2017 have been reduced by €4,740 million, with no impact on Operating profit before depreciation and amortisation. In the balance sheet, due to the new practice of netting unbilled receivables for energy already delivered with advances received from customers (see note 2.1.3.2), the trade receivables, other current receivables and other current liabilities reported at 31 December 2017 have been reduced by €6,568 million, €2,342 million and €8,910 million respectively. In association with implementation of IFRS 15, the Group is monitoring changes in international standards that could affect the current accounting treatment of regulated-tariff activities. The operations concerned by changes of accounting treatment are the following: delivery (the principal-agent distinction) In France and Belgium, the Group concluded that delivery is a distinct service from the supply of energy, and that the energy supplier is acting as an agent in providing this delivery service. In Italy and the UK, however, the energy supplier is classified as a principal for delivery services. In France, the vast majority of electricity delivery services are performed by the French distribution network operator Enedis, which is a regulated subsidiary of the Group. Consequently the principal-agent distinction concerning electricity delivery in France only has an impact on presentation of sales in the reporting by operating segment. These changes have led to a reduction of €1,527 million in reported sales for 2017 from gas and electricity delivery in Belgium and gas delivery in France (and electricity Recognition of income from energy 2.1.1

2.1.2

Recognition of market energy purchase and sale transactions that are part of optimisation activities

The analyses conducted have led the Group to consider that accounting on a net basis provides a more relevant reflection of the economic reality of optimisation transactions. As some Group entities (in Italy, Belgium and in France for Dalkia) previously reported such sales on a gross basis and booked a corresponding entry in energy purchases, this change results in a €2,793 million reduction in the sales and fuel and energy purchases reported at 31 December 2017.

2.1.3

Other impacts

2.1.3.1

Other impacts on the consolidated

income statement Other transactions previously recognised on a gross basis are also now presented on a net basis in application of IFRS 15: agency transactions in Italy and settlements made under the balancing mechanism for the French electricity network, totalling €420 million. These restatements have no impact on the Group’s Operating profit before depreciation and amortisation as published at 31 December 2017. Impacts on the consolidated 2.1.3.2 balance sheet Trade receivables, which include the amount of unbilled receivables for energy already delivered, are now presented net of advances received from customers who pay in regular monthly instalments. This change causes a €6,568 million reduction in Trade receivables and Other current liabilities at 31 December 2017. The related netting of taxes on these amounts causes a decrease of €2,342 million at 31 December 2017 (reduction in “tax liabilities” in Other current liabilities, with a corresponding change in “tax receivables” in Other current receivables).

6.

2.1.4

Summary of impacts on Group Operating profit before depreciation and amortisation

and segment reporting

31/12/2017 as published

Impacts of IFRS 15

31/12/2017 restated

(in millions of euros)

Sales

69,632 (37,641) (8,739) (12,456) (3,541)

(4,740)

64,892 (32,901) (8,739) (12,456) (3,541)

Fuel and energy purchases Other external expenses

4,740

- - - - -

Personnel expenses

Taxes other than income taxes

Other operating income and expenses

6,487 13,742

6,487 13,742

OPERATING PROFIT BEFORE DEPRECIATION AND AMORTISATION

339

EDF I Reference Document 2018