Groupama // 2021 Universal Registration Document

6 EARNINGS AND FINANCIAL POSITION Management report of the Board of Directors

Combined Financial Statements 6.1.6.2 The internal control procedures used to establish the reliability of the consolidated financial data for the shareholders of Groupama Assurances Mutuelles are based on five basic principles: checking the adequacy of skills (internal check), integrated control, parallel control tests, hierarchical control, and Group benchmarking. Security and Internal Checking Procedures (a) They are applied for the departments preparing the consolidated and combined accounts in the same way as described in the section on the corporate accounts (see above). Integrated controls (b) The Group’s system for developing condensed financial data has been implemented throughout the entities. It is based on a single consolidated data production base. All the entities supply this database with data through secure links. It contains a large number of controls designed to guarantee the quality of the financial data: the first verification level entails checking the consistency of data ❯ standard (all the Group’s data is presented in a format that follows a single standard); at a second level, a series of automatic checks is built into the ❯ entities’ individual data-gathering phase. These checks mainly relate to the overall accuracy and consistency of the items entered. Depending on the types of control, the data input may either be blocked automatically (which can only be cancelled if the exact data is input), or else the control returns an error, which must be corrected. An audit trail of these controls is maintained centrally. The software allows a fairly high level of automatic control through the development of interfaces with the upstream systems; at the central level, additional controls are carried out. These ❯ mainly involve the necessary consistency of the data among the different entities in the Group (such as, for example, for internal reciprocal transactions) and central transactions (conversion of foreign subsidiaries, consolidation entries, etc.). The system has an audit trail that can run any cross-checks that might be desired, to identify and monitor any data item and trace the source of any elementary data, from the parent company to the consolidated level. This set of parameters is tested regularly (particularly by republishing old scenarios). Control Tests (c) A set of verification and control tests has been put into place to ensure that transactions are executed reliably whether they are electronic or not. In addition to the electronic processes, these tests have two main objectives: checking the origin of the data (from the standpoint of accuracy ❯ and application of the standards); this check is based mainly on consistency checks with the estimates, with the parent company analytical notes (or the management report) of each entity, and on a management questionnaire designed to ensure that the Group’s most sensitive accounting standards and methods are properly applied;

verification of central processing: accuracy checks are carried ❯ out to guarantee that central consolidation transactions are correctly processed (sharing of Group's equity, dilutions/accretions, etc.). The control tests are documented in a review manual. Hierarchical Control (d) Hierarchical control seeks to ensure that the principal items affecting the truthfulness and accuracy of the financial data, as well as the asset position and the profit/loss (parent company and consolidated) disclosed to the shareholders, are captured in the data presented. This control involves the use of several procedures: checking for consistency with the estimates and with any item ❯ used to cross-check the data appearing in the financial statements; meetings to approve the financial statements with the ❯ employees producing the financial data (with a review of any problem subjects encountered during the approval process); approval meetings with the statutory auditors of the ❯ consolidated financial statements; meetings with the General Management Committee to review ❯ the consolidated financial statements; meetings of the Audit and Risk Management Committee to ❯ review the consolidated financial statements. All of these tasks are aimed at enhancing the quality of the financial data, particularly the consolidated financial statements as well as the management report to the Board of Directors. The Group Standard (e) The accounting standards for the consolidated financial statements are the IFRS. They are distributed at Group level, and instructions for using them are given in a consolidation manual containing reminders of each line item in the balance sheet and the income statement: IFRS reference text and a summary of the standard; ❯ the area of application and possible options selected by the ❯ Group wherever the IFRS leave the possibility of applying options; methods of application. ❯ The consolidation manual is available online. It can be accessed by all the entities in the Group (French and English versions). It is updated regularly based on any changes in the IFRS. This consolidation manual also includes instructions (French and English versions) issued at every closing to all Group entities. The instructions emphasise the specific items applicable to each approval process. These instructions are sent to the statutory auditors for information. Training in both methodology and operations is given regularly to all the players involved in the Group so that the requirements introduced by the IFRS are properly understood and incorporated into the financial statements.

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Universal Registration Document 2021 - GROUPAMA ASSURANCES MUTUELLES