Sopra Steria - 2019 Universal registration document

6 2019 PARENT COMPANY FINANCIAL STATEMENTS Notes to the balance sheet

Loans and other financial investments d. At the balance sheet date, this item mainly comprised the following: loans to UK subsidiaries for £30.000 million (€35.260 million); p liquidity agreement (shares and cash): €2.747 million; p treasury shares for €2.323 million (net of impairment); p units in FCPI investment funds for €10.000 million; p merger loss on financial assets: €481.747 million. p

During the financial year, this item reflected the impact of the £10 million partial repayment of the outstanding balance of loans to UK subsidiaries and of the maturity of the 2016 LTI plan, for which the following movements were recorded: repurchase of 25,000 treasury shares in the market, for a total p value of €2.590 million; awards of 52,287 free shares, for a total value of €7.090 million. p

Other assets 5.2.

INVENTORIES AND WORK IN PROGRESS 5.2.1.

Inventories (beginning of period)

Inventories (end of period)

Increase

Decrease

(in thousands of euros)

Consumables

58

- - -

11

47

Work in progress

4,587 4,645

752 763

3,835 3,882

TOTAL

Work in progress recognises all costs incurred during the transition or transformation phases of third-party application maintenance, infrastructure management and outsourcing contracts, as well as preparatory phases for SaaS licences. Costs incurred in the startup phase of a contract may be deferred over the term of the contract and recognised in the balance sheet as work p in progress when they relate to future activities of the contract and provided that they are probable and generate future economic benefits. Work in progress is recognised at its direct production cost and does not include administrative or commercial costs. p

TRADE RECEIVABLES 5.2.2.

2019

2018

(in thousands of euros)

Non-Group clients and related accounts

292,304 95,271 25,125

229,897 67,468 26,752

Accrued income

Group clients (including accrued income)

Doubtful debtors

331

144

Provision for doubtful debtors

-284

-129

TOTAL

412,745

324,132

Trade receivables and related accounts are recognised as assets and are stated at their carrying amount. Accrued income is essentially comprised of production recognised for fixed-price projects using the percentage-of-completion method. Invoices are generally prepared for these contracts upon completion of the services rendered, which are covered over the lifespan of the projects through payments on account. Trade receivables amounted to €412,745 million in 2019, compared with €324,132 million in 2018. This change mainly arose from the fact that in 2018 the Company completed a sale of trade receivables for €68.120 million, a transaction that did not recur in financial year 2019. Trade receivables are measured at their nominal value. p A separate estimate is made for trade receivables at the end of the financial year and an impairment loss is recognised in the event of a p risk of non-recovery, particularly when linked to collective proceedings. Doubtful debts for which legal proceedings have not been instigated are treated as accrued credit notes.

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SOPRA STERIA UNIVERSAL REGISTRATION DOCUMENT 2019