NATIXIS - Universal registration document and financial report 2019

FINANCIAL DATA Statutory Auditors’ report on the consolidated financial statements

Recognition and measurement of performance fees Risk identified and main judgments

Our audit approach We examined the calculation and control process for performance fees implemented by affiliates of Natixis Investment Managers. In particular, we tested the periodic reconciliations performed between the performance fees calculated by the management of the affiliates and the recognized amounts and, in the case of funds, the amounts provided by “valuation agents”. Based on a sample of selected funds, we also: checked that the benchmark used matches the benchmark V referred to in the contractual provisions; reconciled the fee amounts determined by management and the V recognized amounts; in the case of funds, reconciled the recognized performance fees V and the fees calculated by the funds’ “valuation agents”; checked that the asset management company recorded the fees V at the end of the calculation period specified in the contractual provisions; verified the manner in which the Group estimates and integrates V any uncertainties into the recognized fee amount.

For certain funds managed by affiliates of Natixis Investment Managers, the contractual provisions of the prospectus stipulate the payment of a “performance fee” for any fund outperformance. As mentioned in Note 7.2 to the consolidated financial statements, performance fees recorded in the income statement totaled €627 million and made up a large share of the Group’s net revenues (€9,219 million). The existence of multiple end dates and trigger criteria creates complexity not only for the calculation of these fees, but also in determining the various recognition dates for the corresponding income. Furthermore, if uncertainty exists regarding the measurement of a performance fee amount, only the amount for which the Group’s entitlement is assured given the information available on the reporting date is recognized (the principles applicable to performance fees are set out in Note 6.19 to the consolidated financial statements). We therefore considered the recognition and measurement of performance fees to be a key audit matter.

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NATIXIS UNIVERSAL REGISTRATION DOCUMENT 2019