Euronext - 2020 Universal Registration Document

Financial Statements

Notes to the Consolidated Financial Statements

Trade and Contract Receivables The Group applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade and contract receivables. To measure expected credit losses, trade and contract receivables have been grouped based on shared credit risk characteristics and the days past due. The historical loss rates are based on the payment profiles of the sales over a period of 24months before reporting date and the corresponding historical credit losses experience within this period. The historical loss rates are adjusted to reflect current and forward-looking factors specific to the debtors and economic

environment. Generally trade receivables are written-off if past due more than one year, or when there is no reasonable expectation of recovery. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in Note 21. The Group evaluates the concentration of credit risk with respect to trade and contract receivables as low, as most of its customers are leading financial institutions that are highly rated. Set out below is the information about the credit risk exposure on the Group’s trade and contract receivables using a provision matrix as at 31 December 2020 and 2019:

31 December 2020

Trade receivables

Contract Receivables

30-60 days past due

61-90 days past due

> 91 days past due

Current

Total

In thousands of euros

Expected credit loss rate

0.79% 24,926

0.08% 57,560

0.23% 17,521

0.60% 1,822

1.73% 28,130

Collectively assessed receivables Expected credit loss collective basis

129,959

196

45

40

11

486

778

Expected credit loss rate

– – –

– – –

– – –

– – –

100.0%

2,600 2,600 3,086

2,600 2,600 3,378

Individually assessed receivables Expected credit loss individual basis TOTAL EXPECTED CREDIT LOSS

196

45

40

11

31 December 2019

Trade receivables

Contract Receivables

30-60 days past due

61-90 days past due

> 91 days past due

Current

Total

In thousands of euros

Expected credit loss rate

0.09% 19,878

0.09% 43,787

0.24% 28,314

0.63% 7,597

1.75% 12,938

Collectively assessed receivables Expected credit loss collective basis

112,514

17

38

68

48

226

397

–

Expected credit loss rate

– – –

– – –

– – –

– – –

100.0%

1,221 1,221 1,447

1,221 1,221 1,618

Individually assessed receivables Expected credit loss individual basis TOTAL EXPECTED CREDIT LOSS

17

38

68

48

any material provision for expected credit losses on its other debt financial assets at amortised cost and FVOCI as per 31 December 2020 (2019: not material). The amount of credit-impaired financial assets is considered not significant. Equity Market risk The Group’s investment in publicly traded equity securities was insignificant in 2020 and 2019. Capital Management The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern, to comply with regulatory requirements and to maintain an optimal capital structure to reduce the cost of capital and provide return to shareholders. Certain entities of the Group are regulated as Exchanges or as Central Securities Depository (“CSD”) and are 37.5 37.6

In 2020, the increase in loss allowance provision, was due to i) a higher customer base in general, ii) longer period of amounts outstanding, iii) adjustment of historical loss rates for non-trading customers to reflect increased risk in current economic environment and iv) an increase of individually assessed customers at risk. Other Debt Financial Assets at Amortised Cost and FVOCI The other debt financial assets comprise i) debt investments at amortised cost, which include short-term deposits with a maturity over three months and ii) debt investments at FVOCI, which include investments in listed bonds. The other debt financial assets at amortised cost and FVOCI are considered to have low credit risk, as the issuers of the instruments have a low risk of default evidenced by their strong capacity to meet their contractual cash flow obligations in the near term. The loss allowance recognised during the period was therefore limited to 12 months expected credit losses. The Group did not recognise

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2020 UNIVERSAL REGISTRATION DOCUMENT