TELEPERFORMANCE_Registration_document_2017

CONSOLIDATED FINANCIAL STATEMENTS

7.6 Notes to the consolidated financial statements

NOTE E.2 Deferred tax Deferred tax is calculated and recognized using the liability method, providing for all temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax assets and liabilities are measured using the tax rate that is expected to apply in the period when the asset is realized and the liability settled, according to tax laws that have been enacted or substantively enacted at the reporting date.

Deferred tax assets and liabilities are netted by tax entity for presentation in the statement of financial position. A deferred tax asset is recognized only to the extent that it is likely that future taxable profits will be available against which the asset can be utilized. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

Deferred tax assets

Deferred tax liabilities

including assets from tax losses

b

Net -74

AT DECEMBERb31 ST , 2015 Change in consolidation scope Recognized in profit or loss Offset of assets and liabilities AT DECEMBERb31 ST , 2016 Recognized in profit or loss Translation differences

36

110 338

15

7 5

-331

b b b b b b b

-9

14

-1

21

-22

-16

-16

0

31

444 -178

-413

7

-9 -2

169

Translation differences

-40

38

Offset of assets and liabilities AT DECEMBERb31 ST , 2017

8

8

0

28

234

-206

7

carried forward were not recognized as their recovery was not considered probable. The US tax reform adopted at the end of December 2017bhad the following two principal effects on the 2017bfinancial statements: ■ remeasurement of the deferred taxes recognized in US Group companies using a federal income tax rate of 21%, compared with the previous rate of 35%, resulting in a profit of €146.8bmillion; ■ recognition of expense of €15.5bmillion on the undistributed earnings of the foreign subsidiaries of US companies. The related payments will be spread over a period of eight years.

Deferred tax liabilities related to intangible assets recognized as part of a business combination amounted to €224.4bmillion at Decemberb31 st , 2017 (€432.0bmillion at Decemberb31 st , 2016). Deferred tax assets amounted to €27.6bmillion at Decemberb31 st , 2017 (€31.2bmillion at Decemberb31 st , 2016) including amounts relating to tax losses carried forward of €6.8bmillion. The Group has tax losses of approximately €103bmillion, of which €91bmillion have no expiry date. Deferred tax assets of €20.8bmillion at Decemberb31 st , 2017 (€22.6bmillion at Decemberb31 st , 2016) relating to tax losses

7

189

Teleperformance bb - bb Registration documentbb 2017