UNIVERSAL REGISTRATION DOCUMENT 2023

7 FINANCIAL STATEMENTS Combined financial statements and notes

3.1.2 Other intangible assets Intangible fixed assets are identifiable assets, controlled by the entity because of past events and from which future economic benefits are expected for the entity. They primarily include the values of non ‑ life insurance contract portfolios, customer relationships, and networks and brands as determined during business combinations, as well as software acquired and developed. Amortisable intangible insurance assets (specifically including the values of non ‑ life insurance contract portfolios, customer relationships, and networks) are depreciated as margins are discharged over the lifetime of the contract portfolios. A recoverability test is performed each year, based on experience and anticipated changes in major assumptions, and may result in impairment. Software acquired and developed has a finite lifetime and is generally amortised on a straight ‑ line basis over that lifetime. Other intangible assets that do not have a finite lifetime are not 3.2.1 Investment property The Group has chosen to recognise investment property using the cost method, except in special cases for properties held in unit ‑ linked contracts that are designated at fair value through net income. (a) Investment property recognised at cost INITIAL RECOGNITION Lands and properties appear on the balance sheet at their acquisition cost. Acquisition cost of the property is the outcome of either outright acquisition or acquisition of a consolidated company that owns a property. In the latter case, the cost of the property is equal to its fair value on the date of acquisition of the owner company. The acquisition cost of the property includes material transaction costs directly attributable to the transaction. When a real estate asset includes a portion held to produce rental income and another part used for production or administrative purposes, the asset is treated as investment property only if the latter is immaterial. On initial recognition, properties are divided into components. Investments of insurance businesses (including investments representing unit ‑ linked contracts whose financial risk is borne by the policyholders) and investments of other businesses include investment property, operating property, financial investments, and derivative assets. Investments and any impairment thereon are valued in accordance with IFRS based on the asset class of the investments. amortised but do routinely undergo an impairment. Start ‑ up costs are expensed rather than capitalised. Investments of insurance businesses and other businesses 3.2

VALUATION Under the cost method, investment property is carried at acquisition cost, minus cumulative depreciation, and corrected for any reserves for impairment. Property components are depreciated over their estimated useful life. The depreciation periods applied by the Group for each component depend on the nature of the property in question. They are as follows: building shell (depreciation period between 30 and 120 years); ❯ wind- and water ‑ tight facilities (depreciation period between 30 and 35 years); ❯ heavy equipment (depreciation period between 20 and 25 years); ❯ secondary equipment, fixtures and fittings (depreciation period between 10 and 15 years); ❯ maintenance (depreciation period: 5 years). ❯ The residual value of the shell component cannot be valued with sufficient reliability, particularly given the uncertainties about the holding horizon; thus this component is amortised on the basis of the acquisition cost. Rent income is recorded using the straight ‑ line method over the term of the lease agreement. The fair value of property investments is determined on the basis of an appraisal conducted at most every five years and reviewed annually by an independent expert. SUBSEQUENT EXPENDITURE Subsequent expenditure must be added to the carrying amount of the property: RESERVES FOR IMPAIRMENT On each reporting date of its financial statements, the Group determines whether there is evidence of a potential impairment loss on properties carried at cost. If this is the case, the recoverable amount of the property is calculated as being the higher of two values: its fair value minus costs to sell and its value in use. If the realisable value is less than the net carrying amount, the Group recognises a loss of value in the income statement for the difference between the two values, and the net carrying amount is discounted to reflect only the realisable value. When the value of the property increases at a later time, the reserve for impairment is written back through income. DERECOGNITION Gains or losses from the disposal of property investments are recorded in the income statement on the date of realisation and represent the difference between the net sale price and the net carrying amount of the asset. if it is probable that these expenses will allow the asset to generate economic benefits; ❯ and these expenses can be reliably valued. ❯

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Universal Registration Document 2023 GROUPAMA ASSURANCES MUTUELLES