Groupama // 2021 Universal Registration Document

7 FINANCIAL STATEMENTS Combined financial statements and notes

3.9

Group's equity

The Group has chosen to apply the optional treatment stipulated in IFRS 16 for rental agreements of less than 12 months’ duration and contracts involving low-value assets, recognising the rent for these under expenses in the income statement. Other property, plant, and equipment 3.6.2 Directly-owned property, plant and equipment other than operating property are initially recorded at acquisition cost, which consists of the purchase price, customs duties, discounts and rebates, direct costs necessary for installation and payment discounts. The depreciation methods reflect the method of economic consumption. An impairment test is conducted once there is an indication of a loss of value. The loss of value is reversible and corresponds to the surplus between the book value over the realisable value, which is the higher of net fair value of withdrawal costs and the value in use. The recognition and valuation method for user rights on other property, plant, and equipment owned by the lessee under a lease is identical to the method described for user rights on investment property. payables, other assets and other liabilities Operating receivables and other assets are recorded at face value, taking into account any transaction costs. Operating payables and other liabilities are recorded at the fair value of the consideration received in exchange at the origin of the contract, net of transaction costs. Moreover, non-controlling interests in fully consolidated mutual funds are included in other liabilities. Under IAS 32, a financial instrument that gives the holder the right to return it to the issuer in exchange for cash is a financial liability. The change in this liability is recognised through the income statement. Operating receivables and 3.7

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 revaluation of derivatives assigned to cash flow ❯ hedges and net investments in currencies pursuant to IAS 21; the effects of the revaluation of 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 available-for-sale investment assets; 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 instruments akin to 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 translation of statutory financial statements of foreign subsidiaries prepared in a currency other 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 consolidated mutual funds and the purchase of non-controlling interests, refer to paragraphs 3.7 and 3.11). Reserves for contingencies and 3.10 charges Reserves for contingencies and charges are liabilities for which the due date or the amount is uncertain. A reserve must be recognised if the following three conditions are met: the Company has a current legal or implicit obligation that is the ❯ result of a past event; it is probable that an outflow of resources representing economic ❯ benefits will be necessary to discharge the obligation; it is possible to obtain a reliable estimate of the amount of the ❯ reserve.

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.

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Universal Registration Document 2021 - GROUPAMA ASSURANCES MUTUELLES