2017 CONSOLIDATED FINANCIAL STATEMENTS Notes to the consolidated financial statements

At 31 December 2017, the Axway Software shares held by Sopra Steria Group represented 32.59% of the share capital, compared with 32.89% at 31 December 2016. Their recoverable amount is estimated as follows:



(in millions of euros)

Market value (Category 1) Market value less costs to sell

157.6 154.5 198.3

211.5 207.3 224.3

Value in use

Discounted cash flow calculation parameters:



9.6% 2.2%


p discount rate


p perpetual growth rate RECOVERABLE AMOUNT



A 0.5-point decrease in the perpetual growth rate, all other things being equal, would have the same effect. This test is based on the judgement of management and takes into account the uncertainties inherent in the transformation of Axway’s business model.

Their value in use, the higher of the two values used to determine the recoverable amount, supports the carrying amount of the equity- accounted Axway Software shares at 31 December 2017. A 0.3-point increase in the discount rate, all other things being equal, would cause the carrying amount to exceed the recoverable amount.




(in millions of euros)

Assets Equity

551.1 344.1 207.0 299.8

557.8 374.8 183.0 301.1

Liabilities excluding equity

Revenue Net profit



Recognition and impairment of investments in associates Investments in associates are initially recognised at acquisition cost, and their value is then adjusted to reflect changes in the Group’s share of their net assets. The remainder of this share appears under Equity-accounted investments on the asset side of the balance sheet. Its change over the financial year is stated in the income statement under Net profit from associates . Equity-accounted shares in a company constitute a single asset and must be tested for impairment in accordance with IAS 36 Impairment of Assets . Goodwill on associates is included in the value of equity- accounted investments, the value of which is measured inclusive of goodwill. As such, goodwill on associates must not be tested for impairment separately. At each balance sheet date, where there is an indication of impairment of an investment in an associate, the parent company must carry out

an impairment test consisting of comparing the carrying amount of the relevant equity-accounted investment with its recoverable amount. Under IAS 36, the recoverable amount of an investment in an associate is the higher of its value in use, calculated on the basis of future cash flows, and the fair value of the investment less costs of disposal. Where an associate’s shares are listed, fair value less costs of disposal is equal to market price less costs to sell: in the absence of any firm sale agreement, this is the price at which the shares are currently trading. Any impairment losses are charged to profit and loss as Other operating income and expenses . Where there is an improvement in the recoverable amount of an equity-accounted investment such that the impairment loss may be written back, the full amount of the impairment loss, including the portion relating to goodwill, must be written back.



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