Econocom - 2019 Universal registration document

06 consolidated financial statements

notes to the consolidated financial statements

Full derecognition When a financial asset is derecognised in full, a gain or loss on disposal is recorded in the income statement for the difference between the carrying amount of the asset and the consideration received or receivable, adjusted where necessary for any gains or losses recognised in other comprehensive income and accumulated in equity. Partial derecognition When a financial asset is partially derecognised, the Group allocates the previous carrying amount of the financial asset between the part that continues to be recognised in connection with the Group’s continuing involvement and the part that is derecognised, based on the relative fair values of those parts on the date of the transfer. The difference between the carrying amount allocated to the part derecognised and the sum of the consideration received for the part derecognised and any cumulative gain or ژ loss allocated to it that had been recognised in other comprehensive income, is recognised in profit or loss. A cumulative gain or loss carried in other comprehensive income is allocated between the part that continues to be recognised and the part that is derecognised, based on the relative fair values of those parts. Factoring liabilities Certain subsidiaries of Econocom Group use factoring to diversify financing sources

and reduce credit risk. Factoring with contractual subrogation involves the transfer of ownership of trade receivables and all associated rights to the factor. This means transfer of the right to receive cash flows. As required under IFRS ژ 9 – Financial instruments: Recognition and Measurement, these receivables are derecognised when substantially all the risks and rewards of ownership are transferred to the factor. Where this is not the case they are maintained in the statement of financial position after the transfer and a financial liability is recorded as an offsetting entry for the cash received. Information on the 21.2. transfer of assets – Assets not derecognised in full Assignment of trade receivables For the purpose of optimising its cash management for its Digital, Services & Solutions businesses, the Group assigns a portion of its trade receivables throughout the ژ year to factoring companies. At 31 ژ December 2019, the Company had an amount of €299.9 million with factoring companies, resulting in non-recourse financing of €246.7 million. The unfinanced amount of €49.2 ژ million is recognised in long-term financial assets and other receivables, and corresponds to unassignable receivables (security guarantees).

2019

2018

in € ڳ millions

ژ 299.9

285.5

Receivables assigned to factoring companies

ژ 4.0

8.6

Payables

ژ 49.2

23.9

Non-factored receivables

Receivables sold with no recourse* 253.0 Receivables sold do not include the portion of receivables financed with recourse, classified in liabilities. * ژ 246.7

The overall factoring cost amounted to €2.5 million in 2019 compared with €3.1 million in 2018.

248

2019 annual report