UNIVERSAL REGISTRATION DOCUMENT 2023

7 FINANCIAL STATEMENTS Combined financial statements and notes

3.10 Provisions for contingent liabilities Provisions for contingent liabilities are liabilities for which the due date or the amount is uncertain. A provision 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. ❯ (d) Foreign exchange adjustments 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. (e) Non ‑ controlling interests 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, refer to paragraph 3.7). accumulated realised gains and losses on equity instruments measured at fair value through OCI not recyclable to profit or loss; ❯ impact of changes in accounting methods. ❯ 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. (b) Subordinated debt classified as perpetual equity Perpetual subordinated debt (TSDI) with characteristics meeting the definition of an equity instrument is recognised in equity in accordance with IAS 32. Remuneration from these securities is treated like a dividend on shareholders’ equity. (c) Other reserves Other reserves consist of the following items: the impact of the revaluation of derivatives used to hedge cash flows and net investments in foreign currencies; ❯ the cumulative impact of the deferred tax gain or loss generated by the transactions described above. ❯ retained earnings; ❯ consolidated reserves; ❯ other regulated reserves; ❯

3.6.2 Other property, plant and equipment 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 carrying amount 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.

3.7

Operating receivables and payables, other assets, and other liabilities

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.

3.8

Cash and cash equivalents

Cash corresponds to available cash. 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 IFRS equity

(a) Revaluation reserves The revaluation reserve includes, in particular:

reserves relating to changes in the fair value of financial instruments measured at fair value through OCI (equity instruments designated at fair value through non ‑ recyclable OCI and debt instruments measured at fair value through recyclable OCI); ❯ OCI reserves relating to insurance and reinsurance contract financial income or expenses; ❯ reserves for impairment of debt instruments measured at fair value through OCI (recyclable); ❯

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Universal Registration Document 2023 GROUPAMA ASSURANCES MUTUELLES