Hermès // 2022 UNIVERSAL REGISTRATION DOCUMENT

CONSOLIDATED FINANCIAL STATEMENTS NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

INVESTMENTS IN ASSOCIATES

NOTE 8

Accounting principles On the balance sheet, on the acquisition of securities of equity‑accounted companies, goodwill is included in the carrying amount of securities recognised in “Investments in associates”. Any impairment relating to this goodwill is reversible (see note 7.4). The item “Net income from associates” shown in the income statement includes the following:

any provisions for risk. If the Group's share in the losses of an associate exceeds the carrying amount of its holding in the Company, then the Group will no longer recognise its share in subsequent losses. When the share reaches zero, additional losses are only the subject of a provision when the Group has a legal or implicit obligation in this respect, or has made payments on behalf of the associate. s

share of the Group’s income in these companies; s

2022

2021

In millions of euros

Investments in associates as at 1January Impact of consolidation scope changes

51

49

-

-

Net income from associates

50

34

Dividends paid

(56)

(37)

Exchange rate impact

2 7

1 3

Other

INVESTMENTS IN ASSOCIATES AS AT 31DECEMBER

54

51

The “Other” line includes, where appropriate, the reclassification to “Provisions” of the Group share in the losses of associates, when this exceeds the carrying amount of the investments concerned.

5

FINANCIAL ASSETS AND LIABILITIES – NET CASH POSITION

NOTE 9

Accounting principles Financial assets and liabilities

Classification of financial assets and liabilities and valuation methods In accordance with IFRS9, Hermès Group financial assets and liabilities are classified and valued upon their recognition in the balance sheet according to following categories determined on the basis of the management model and the characteristics of the contractual cash flows: financial assets and liabilities at fair value through profit or loss; s financial assets recorded at amortised cost; s financial assets at fair value through non‑recyclable equity. s Financial assets and liabilities at fair value through profit or loss These assets are initially recognised at acquisition cost excluding incidental acquisition expenses. At each closing date, they are measured at fair value. Changes in fair value are recorded in the income statement under “Other financial income and expenses”. Dividends and interest received on these assets are also recognised in the income statement under “Other financial income and expenses”.

Financial assets include financial fixed assets (financial investments, liquidity contract, non‑consolidated and other investment securities), loans and financial receivables, and the positive fair value of financial derivatives. Financial liabilities include borrowings and debt, bank lines of credit and the negative fair value of financial derivatives. They do not include the liability associated with employee profit‑sharing, which is included in “Other liabilities”. Financial assets and liabilities are presented in the balance sheet under current or non‑current assets or liabilities, depending on whether they fall due within one year or more, with the exception of trading derivatives, which are recorded under current assets or liabilities. Operating payables and receivables and cash and cash equivalents fall within the scope of IFRS9 Financial Instruments and are presented separately in the balance sheet.

2022 UNIVERSAL REGISTRATION DOCUMENT HERMÈS INTERNATIONAL

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