GROUPAMA / 2020 UNIVERSAL REGISTRATION DOCUMENT

7 FINANCIAL STATEMENTS Consolidated financial statements and notes

Reserves for contingencies and 3.10 charges Reserves for contingenciesand charges are liabilities for which the due date or the amount is uncertain.A reservemust be recognised if the following three conditions are met: the Companyhas a current legal or implicit obligation that is the ❯ result of a past event; it is probablethat an outflowof resourcesrepresentingeconomic ❯ benefits will be necessary to discharge the obligation; it is possible to obtain a reliable estimate of the amount of the ❯ reserve. When the impact of the time value of the money is substantial, the amount of the reserves is discounted to the present value of the expected expenditures,which the Company believes necessary to discharge the obligation. The Group’s companies have different retirement schemes. The schemes are generally financed by contributionspaid to insurance companies or other funds, which are administeredand valued on the basis of periodic actuarial calculations. The Group has defined-benefit schemes and defined-contribution schemes. A defined-contributionscheme is a retirement scheme under which the Group pays fixed contributionsto an independententity. In this case, the Group is not bound by any legal or implied obligation forcing it to top up the scheme in the event that the assets are not sufficient to pay, to all employees, the benefits due for services rendered during the current fiscal year and previous fiscal years. Pension schemes that are not defined contribution schemes are defined benefit schemes. This is the case, for example, for a scheme that defines the amount of the pension benefit that will be collected by an employee at retirement, which is generally a function of one or more factors, such as age, senioriatynd salary. The liabilities recorded in the balance sheet for defined-benefit schemes and similar schemes correspondto the discountedvalue of the obligation linked to the defined-benefitschemes at closing, after deducting the closing fair value of the scheme assets. The actuarial gains and losses resulting from experience-based adjustments and modifications in the actuarial assumptions are recognised directly in equity. The costs of past services are immediately recognised in income, regardlessof whether the rights are ultimatelyacquired in the event of a change of pension scheme. With regard to defined-contribution schemes, the Group pays contributionsto retirement insuranceschemesand is not bound by any other payment commitment.The contributionsare booked as expenses related to personnel benefits when they are due. The contributions paid in advance are recorded as assets to the extent that the advancepayment results in a reductionof future payments or a cash reimbursement. Personnel benefits 3.10.1 Pension commitments

3.8 Cash corresponds to available cash.

Cash and cash equivalents

Cash equivalents are short-term liquid investments, easily convertible into a known amount of cash and subject to an insignificant risk of changes in value.

3.9

Group's equity

Revaluation reserves 3.9.1 The revaluation reserve contains the differences resulting from the revaluation at fair value of balance sheet items, particularly: the effects of the revaluationof derivativesassigned to cash flow ❯ hedges and net investments in currencies pursuant to IAS 21; the effects of the revaluationof financial assets available-for-sale ❯ in accordance with the provisions of IAS 39. These are unrealised capital gains/losses; the cumulative impact of the gain or loss from shadow ❯ accounting of investment assets available-for-sale; the cumulative impact of the deferred tax gain or loss generated ❯ by the transactions described above.

Other reserves 3.9.2 Other reserves consist of the following items: retained earnings; ❯ Group consolidation reserves; ❯ other regulated reserves; ❯ the impact of changes in accounting methods; ❯

equity instrumentsakin to deeply subordinatedinstruments(TSS) ❯ or perpetual subordinated bonds (TSDI) whose features allow recognition in Group’s equity. Remuneration from these securities is treated like a dividend on Group's equity. Foreign exchange adjustments 3.9.3 Foreign exchange adjustments result from the consolidation process owing to the translationof statutory financial statementsof foreign subsidiaries prepared in a currencoyther than the euro. Non-controlling interests 3.9.4 Non-controlling interests represent the share in the net assets and net income of a fully consolidated Group company. This share represents the interests that are not held directly by the parent company or indirectly through subsidiaries (concerning non-controlling interests relating to consolidatedmutual funds and the purchase of non-controlling interests, refer to paragraphs 3.7 and 3.11).

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Universal Registration Document 2020 - GROUPAMA ASSURANCES MUTUELLES