TELEPERFORMANCE_Registration_document_2017

PARENT COMPANY FINANCIAL STATEMENTS

8

8.4 Notes to the parent company financial statements

NOTE 1.4 Interest and exchange risk management The Company is exposed to exchange and/or interest rate risks through the following transactions: ■ loans and borrowings with its subsidiaries denominated in foreign currency in the context of financing transactions; ■ receivables and payables with its subsidiaries denominated in foreign currency from transactions in the normal course of business; ■ centralized cash-pooling accounts denominated in foreign currency; The Company uses derivative financial instruments, contracted with a number of financial institutions of good standing, to manage its exposure to these risks. These financial instruments comprise principally currency swaps, forward currency sales and purchases, and exchange options, interest rate swaps and a Cross Currency Interest Swap. In compliance with regulation ANC n°2015-05 dated Julyb2 nd , 2015, the Company applies hedge accounting when a hedge relationship has been so identified in the management system and when the qualifying criteria are fulfilled. The Company recognizes derivative ■ loans from financial institutions.

financial instruments to which hedge accounting is not applied in accordance with the principles applying to unrelated open positions. When hedge accounting is applicable, the fair value of derivative financial instruments is recognized in a symmetrical manner with the hedged item. Gains and losses realized on expired hedge instruments when the hedged item remains on the balance sheet are deferred (as deferred income or prepaid expenses) until the hedged item is realized. When the Company has unrelated open positions, the fair value of the financial instruments is recognized on the balance sheet and a provision for unrealized losses is made when this is negative, unless offset by unrealized gains arising from an overall net exchange position. As part of its strategy for the management of the Group’s exchange risk, the Company hedges the forecast transactions of its subsidiaries using derivative exchange instruments contracted with financial institutions and the subsidiaries concerned. These transactions are accounted for as unrelated open positions.

NOTE 1.5 Centralized cash management Advances from Teleperformance to its subsidiaries relating to the cash pool are presented in “Other receivables’’, while amounts lent to it are shown in “Other loans and financial liabilities”. NOTE 1.6 Incentive share award plans

The Board of Directors’ meetings on Aprilb28 th and Novemberb2 nd , 2016bapproved free awards of 914,300 and 151,508 incentive plan shares, respectively, to Group personnel, including company officers of Group subsidiaries, under the authorization given at the shareholders’ general meeting of Aprilb28 th , 2016, limited to a maximum of 2.5% of the share capital of the Company at the grant date. Vesting of the free share awards is conditional on the beneficiaries remaining with the Group until at least the end of the vesting

period and on meeting certain performance conditions relating to the financial years from 2016bto 2018. The Board of Directors’ meeting on Juneb23 rd , 2017bapproved the free award of 11,600bincentive plan shares to a company officer of a Group subsidiary, under the authorization referred to above. Vesting of the free share award is conditional on the beneficiary’s continued presence until at least the end of the vesting period and on meeting certain performance conditions.

Note 2

Tangible and intangible fixed assets

12/31/2017

12/31/2016

Accumulated depreciation,

Accumulated depreciation,

amortization and impairment losses

amortization and impairment losses

(in thousands of euros)

Cost

Net 186

Cost

Net 257

Intangible fixed assets Tangible fixed assets

3,923 5,110

3,737 3,231

3,923 4,857

3,666 3,461

1,879

1,396

Land

305

b

305 988 586

305

b

305 857 234

■

Buildings

3,480 1,325 9,033

2,492

3,645

2,788

■

Other

739

907

673

■

TOTAL

6,968

2,065

8,780

7,127

1,653

NOTE 2.1 Cost (in thousands of euros) Intangible fixed assets Tangible fixed assets

At 12/31/2017

At 01/01/2017

Increases

Decreases

3,923 4,857

b

b

3,923 5,110

932

679

Land

305

b

b

305

■

Buildings

3,645

456 476 932

621

3,480 1,326 9,033

■

Other

907

57

■

TOTAL

8,780

679

218

Teleperformance bb - bb Registration documentbb 2017