Eurazeo / 2019 Universal Registration Document

Financial Statements Consolidated Financial Statements for the year ended December 31, 2019

the Group may irrevocably choose to designate a debt instrument • meeting the measurement criteria for recognition at amortized cost or fair value through other comprehensive income as measured at fair value through profit or loss, if this designation eliminates orsignificantly reducesa recognitioninconsistency. The Group has designated all its investments in equity instruments at fair valuethroughprofit or loss. Financial assets designated at fair value through profit or loss are measured at fair value at the end of each reporting period, and fair value gains and losses taken to profit or loss unless they form part of a designated hedging relationship. The net gain or loss recognized in profit or loss includes dividends or interest earned on the financial asset recognized in “Revenue”, with fair value gains and losses recognized in“Other income”. Listed securities are valued at their last market price on the reporting date. The Colyzeo and Colyzeo II investment funds are measured, at the valuation date, based on the most recent information communicatedby fundmanagers. Unlisted investments are measured at fair value (market value or the value at which market traders would agree to buy and sell them), in compliance with IPEV recommendations (International Private Equity Valuation Guidelines) and the net asset value calculation methodology. The values obtained are then adjusted to reflect the legal terms and conditions of investments (subordination, commitments, etc.). On the sale of financial assets or investmentsin associates,the first-in, first-out(FIFO) method is appliedto assetsof the samecompany. Impairment offinancial assets The Group recognizes a loss allowance for expected credit losses on investments in debt instruments that are measured at amortized cost or at fair value through other comprehensive income. No impairment is recognized on investments in equity instruments. The amount of expected credit losses is updated at each reporting date to reflect changes in credit risk since the initial recognition of the financial instrument. The Group recognizes all expected credit losses on trade receivables over theirlifetime. Recognition ofborrowings Borrowings are initially recognized at fair value, net of transaction costs incurred and are subsequently measured at amortized cost; any difference between income (net of transaction costs) and the repayment value is recognized in profit or loss over the term of the borrowing usingthe effectiveinterest method. Borrowingsare classified as current liabilities, unless the Group has an unconditional right to defer payment of the liability by at least 12 monthsafter the reportingdate, in which case these borrowingsare classifiedas non-currentliabilities. Transfers offinancial assets andliabilities The Group derecognizes financial assets whenever the rights that make up the assets expire or are relinquished,or when the Group transfers or assigns its rights and is no longer affected by most of the associatedrisks and rewards. The Group derecognizes financial liabilities when a debt is extinguishedor transferred.Whenevera liability is exchangedwith a creditor for one with materially different terms and conditions, a new liability isrecognized.

The lease liability subsequentlychanges as follows: it is increasedin the amountof interestdeterminedby applyingthe • discount rateto the liabilityat the beginning of theperiod; it is decreased by paymentsmade. • The interest expense for the period and any variable payments not included in the initial measurementof the liability and incurred during the periodare expensedto profit orloss. In addition, the lease liability may be remeasured in the following situations: change inthe leaseterm; • change in the assessment of whether the exercise of an option is • reasonablycertain (or not); revised estimateconcerningresidualvalue guarantees; • review of the rates or indexes on which lease payments are based, • when the lease paymentsare adjusted. Financial assetsand liabilities 16.10 Initial recognition offinancial assets andliabilities Financial assets and financial liabilities are initially measured at fair value. Transactioncosts that are directly attributableto 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 attributableto the acquisitionor issue of financial assets and financial liabilities at fair value through profit or loss are expensed immediately to profit orloss. Recognition offinancial 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 subsequentlymeasure at amortized cost if both the followingconditionsare met: the financial asset is held within a businessmodel whose objective • is to hold financialassets inorder to collect contractualcash 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 theprincipalamount outstanding. A debt instrument is subsequently measured at fair value through other items of comprehensive income (potentially reclassifiable) if both thefollowing conditionsare met: the financial asset is held within a businessmodel whose objective • is achieved by both collecting contractual cash flows and selling financialassets; the contractual terms of the financial asset give rise on specified • dates to cash flows that are solely payments of principal and interest on theprincipalamount outstanding. All financial assets are subsequentlymeasured,by default, at fair value throughprofit or loss. Notwithstanding the above, the Group may make the following choices or irrevocable elections at initial recognition of a financial asset: the Group may make an irrevocable election to present in other • comprehensiveincome subsequentchanges in the fair value of an investment in an equity instrument that is neither held for trading nor contingent consideration recognized by an acquirer in a business combinationto which IFRS 3applies;

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2019 UNIVERSAL REGISTRATION DOCUMENT