PSA - 2019 Universal Registration Document

CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2019 Notes to the Consolidated Financial Statements at 31 December 2019

Conversion methods B. Translation ofthe financial statements (1) of foreign subsidiaries Standardmethod (a) The parent’sfunctionalcurrencyis the euro (€), which is also the presentation currency of the Group’s consolidated financial statements.The functionalcurrencyof mostforeignsubsidiaries is their local currency,correspondingto the currencyin which the majorityof their transactionsare denominated.The statementsof financial position of these subsidiaries are translated at the year-end exchange rate and their income statements are translatedon a monthlybasis at the average exchangerate for each month. Gains and losses resulting from the translationof financialstatementsof foreignsubsidiariesare recordedin equity under “Translationreserve”.Goodwillarisingon the acquisitionof subsidiaries is accounted for in the functional currency of the underlyingbusiness. Specificmethod (b) Certainsubsidiariesoutsidethe euro zone carry out most of their transactions in euros or US dollars, which is accordingly recognised as their functional currency, rather than their local currency.Non-monetary items in these subsidiaries’accountsare translatedat the historicalexchangerate and monetaryitems at the year-end exchangerate. The resulting translationgains and losses arerecogniseddirectlyin profitor loss. The Groupdoes not operatein hyperinflationarycountrieswithin the meaning of IAS 21 – The Effects of Changes in Foreign ExchangeRates , exceptArgentina. Translation oftransactionsin foreign (2) currencies In compliancewith IAS 21, transactionsin foreign currenciesare translated into the subsidiary’s functional currency at the exchangerate on thetransaction date. At each statementof financialpositiondate, monetaryitems are translated at the closing rate and the resulting translation adjustment is recognised inprofitor loss,as follows: in operatingincome,for commercialtransactionscarriedout by n all Groupcompaniesand for financingtransactionscarriedout by the BanquePSAFinance group; in interest income or finance costs for financial transactions n carried outby the manufacturing and sales companies.

In the event of a price adjustmentin the 12 monthsfollowingthe acquisitiondate,theprovisional initialassessment is adjustedagainst goodwill.Anysubsequent adjustment is recognised as debtor credit against profit or loss oftheGroup. In accordancewith IAS 36– Impairmentof Assets , goodwillis not amortisedbut testedfor impairmentannuallyor morefrequentlyif events or changes in circumstancesindicate that it might be impaired (seeNote 8.3). Goodwill on equitymethodinvestments (3) Goodwillattributableto acquisitionsof equitymethodinvestments is the excess of the cost of shares, includingdirectlyattributable acquisitioncosts, over the Group’sequity in the acquisition-date fair value of the identifiableassets and liabilities acquired. It is included in “Equity method Investments” and tested for impairment at the level of the equity method investments concerned. Other changes in scope of consolidation (4) Any changein ownershipinterestsresultingin the loss of control of an entity is recognisedin “other operatingincome(loss)” as a disposal of the whole entity immediately followed by an investment in the remaining interest Changes in ownership interests that do not result in a loss of controlof the subsidiaryare accountedfor as equitytransactions (transactions with owners in their capacity as owners) and therefore lead to equity, including transaction costs, being reallocatedbetweenthe Owners of the the parent and the Non controlling interests.

COMPOSITION OFTHE GROUP 3.2. The Groupconsistsof the PeugeotS.A.holdingcompany, listedon Euronext, and its affiliates consolidated in accordance withNote 3.1.

31 December 2019 31 December 2018 31 December 2017

Fully consolidated companies Manufacturing and sales companies

350

325

317

Finance companies

17

18

18

367

343

335

Joint operations Manufacturing and sales companies Companies at equity Manufacturing and sales companies

3

3

3

42 44 86

38 43

55 43 98

Finance companies

81

CONSOLIDATED COMPANIES

456

427

436

182

PSA - GROUPE PSA - 2019 UNIVERSAL REGISTRATION DOCUMENT