Eurazeo / 2018 Registration document

CONSOLIDATED FINANCIAL STATEMENTS Notes to the Consolidated Financial Statements

Property, plant and equipment 16.6 Property, plant and equipment are carried in the balance sheet at their historical cost to the Group, less accumulated depreciation and impairment. Pursuant to IAS 16, Property, plant and equipment, only those items whose cost can be reliably measured and which are likely to produce future benefits for the Group are recognized as assets. Depreciation is calculated on a straight-line basis over the following useful lives:

Assets financed by way of leases with purchase options or long-term leases, which transfer to the lessee substantially all of the risks and rewards of ownership of the asset, are accounted for as fixed assets and depreciated in accordance with accounting principles applicable to property, plant and equipment. The cost of assets includes the upfront costs directly related to securing the lease (negotiation expenses, legal and advisory fees, etc.). The financial commitments arising as a result of these contracts are recognized in borrowings.

Straight-line depreciation in years

Investment activity

Eurazeo Capital Eurazeo PME

Eurazeo Brands

Eurazeo Patrimoine

Property, plant and equipment category

Buildings

8 to 50 3 to 15 3 to 30 3 to 10 3 to 10 3 to 30

8 to 40 3 to 12 3 to 6 2 to 10 1 to 10

15 to 50 1 to 15 2 to 5 5 to 25 2 to 15

Tools and equipment

3 to 5

3

Vehicles

Fixtures and fittings

9 to 10 3 to 5

3 3

Office furniture and equipment, IT equipment

Industrial equipment

3 to 5

Depreciation is recognized from the date on which the asset is ready for commissioning. Land is not depreciated.

Investment properties 16.7 Investment properties are measured initially at cost. The related transaction costs are included in the initial valuation. Subsequent to initial recognition, they are stated at fair value. Gains and losses arising from changes in the fair value of investment properties are recognized in the income statement in the period in which they occur (in other operating income and expenses). The value of investment properties is determined based on reports prepared by appraisers. Impairment of non-financial assets 16.8 Pursuant to IAS 36, Impairment of assets, whenever the value of intangible assets and property, plant and equipment is exposed to a risk of impairment due to events or changes in market conditions, an in-depth review is performed to determine whether the carrying amount is less than the recoverable amount, defined as the greater of fair value (less disposal costs) or value in use. Value in use is calculated by discounting future cash flows expected from the use of the asset. Where the recoverable amount is less than the net carrying amount, an impairment is recognized, corresponding to the difference between those two values. Impairment of property, plant and equipment may subsequently be reversed (up to the amount of the initial impairment) if the recoverable amount rises above the carrying amount once again. Likewise, impairment tests are systematically performed on goodwill and intangible assets with an indefinite life, at the end of each year or if there is indication of impairment. However, any impairment recognized on goodwill cannot be subsequently reversed.

Financial assets and liabilities 16.9 Initial recognition of financial assets and liabilities Financial assets and financial liabilities are recognized when a Group entity becomes a party to the contractual provisions of the instrument. Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets or financial liabilities (that are not financial assets at fair value through profit or loss) are added to or deducted from the fair value of financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition or issue of financial assets and financial liabilities at fair value through profit or loss are expensed immediately to profit or loss. Recognition of financial assets All recognized financial assets are subsequently measured either at amortized cost or fair value, depending on their financial asset classification. A debt instrument is subsequently measure at amortized cost if both the following conditions are met: the financial asset is held within a business model whose objective • is to hold financial assets in order to collect contractual cash flows; the contractual terms of the financial asset give rise on specified • dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. A debt instrument is subsequently measured at fair value through other items of comprehensive income (potentially reclassifiable) if both the following conditions are met: the financial asset is held within a business model whose objective • is achieved by both collecting contractual cash flows and selling financial assets; the contractual terms of the financial asset give rise on specified • dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

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2018 Registration Document