Eurazeo / 2018 Registration document

COMPANY FINANCIAL STATEMENTS Notes to the Company financial statements

5.3.1

ACCOUNTING PRINCIPLES

Investments, portfolio securities, other securities holdings and marketable securities Securities and ownership interests under these headings are recognized at cost, net of incidental acquisition expenses. Depending on the nature of the instrument acquired, amounts invested in the Company’s investments (“long-term” investments) are recognized in one of the following account headings: investments, receivables from investments, portfolio securities, other securities holdings. The accounting classification of these securities is based on the following criteria: Purchased securities are classified in; "Investments", when it is Eurazeo's intention, on acquisition, to create • a sustainable relationship with the Company whose securities it holds and to contribute to the activities of the issuing company, notably by exercising influence over the Company; “Portfolio securities”, when the return on investment is sought • without involvement in the Company’s management; “Securities holdings” when the securities are acquired with the • intention of being held long-term, but the long-term investment is imposed rather than desired and is not considered useful. Measurement Investments are measured at value in use, calculated based on a variety of criteria such as: discounted future cash flows taken from the 5-year business plans • prepared by the management team of each investment and validated by Eurazeo Management. These investment business plans were prepared based on management’s best estimates of the impacts of the current economic climate. Future cash flow estimates are therefore prudent and reflect, where appropriate, the resilience of the investment’s business; comparable multiples – stock market capitalization or transactions • – applied to aggregates taken from the historical income statements or, where appropriate, forecast accounts; the share in accounting net assets; • the average stock market price over the last month; • where appropriate, investments are grouped into cash-generating • units when an investment is held directly or through a holding company. An impairment is recognized where this value is less than the cost price. The value of investments sold is calculated based on the weighted average cost price of the securities concerned. The value of other portfolio securities is calculated at the end of each reporting period taking into account the general prospects of the companies concerned, and primarily based on their market value. If this value is less than the historical cost of the investment, an impairment is recognized. Other securities holdings and marketable securities are reported in the balance sheet at their acquisition price or transfer value, restated, if necessary, for impairment based on their intrinsic or stock market value at the end of the reporting period. In the event of a disposal, portfolio securities, other securities holdings and marketable securities issued by the same company that have been held the longest are deemed to have been sold first.

AND METHODS The annual financial statements have been prepared in accordance with the principles and methods defined in ANC Regulation 2014-03 and subsequent regulations issued by the French Accounting Standards Authority (Autorité des Normes Comptables), as confirmed by the Order of November 4, 2016. Generally accepted accounting principles were applied in accordance with the principle of prudence and the general rules governing the preparation and presentation of financial statements, as well as the basic assumptions of: going concern, • The financial statements have been prepared on a historical cost basis. They are presented in accordance with the recommendations contained in French National Accounting Institute (Conseil national de la Comptabilité) Guideline no. 63, published in January 1987, applicable to portfolio companies. When preparing its financial statements, Eurazeo must make estimates and assumptions that could affect the carrying amount of certain assets, liabilities, revenue and expenses and have an impact on the information contained in the Notes to the financial statements. Eurazeo regularly reviews these estimates and judgments, taking into consideration past experience and other factors deemed relevant in light of economic conditions. Depending on changes in those assumptions or if conditions vary from those anticipated, amounts in future financial statements could differ from the current estimates. The financial statements reflect the best estimates available to the Company, based on information as of the period end, with regard to the uncertain economic environment. Since January 1, 2005, the Company applies the General Chart of Accounts regulations implementing the French National Accounting Institute notices on the definition, recognition and measurement of assets (CRC Regulation no. 2002-10 of December 12, 2002; CRC Regulation no. 2003-07 of December 12, 2003; CRC Regulation no. 2004-06 of November 23, 2004 and the Order of December 24, 2004). Depreciation is calculated on a straight-line basis over the following periods: fixtures and fittings: 9 years; • office equipment 3 to 5 years; • computer hardware 3 or 5 years; • furniture: 9 years. • Gross values include the purchase price and any non-refundable VAT. Non-current asset purchase costs ANC Regulation no. 2014-03 on assets provides for the inclusion in assets of expenses incurred in connection with the purchase of property, plant and equipment, intangible assets, securities holdings and marketable securities and offers an option for them to be expensed in the year incurred. Eurazeo has opted to treat expenses incurred in connection with asset purchases as expenses of the year in the case of property, plant and equipment, intangible assets, securities holdings and marketable securities. accruals; and • consistency. • ACCOUNTING POLICIES 5.3.2 Intangible assets and property, plant and equipment

Eurazeo

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2018 Registration Document