Worldline - 2019 Universal Registration Document

FINANCIALS Consolidated financial statements

Revenue arising from transactional activities Note 3 Revenue, segment information and trade accounts of consolidated financial statements Key Audit Matter Our audit approach

Regarding the revenue arising from transactional activities, in particular those in relation to payments, the transactions are recognized over the period during which the transactions were processed. Those activities are relying upon numerous and complex IT applications which are collecting and evaluating all transactions through the Group’s various payment processing platforms. We have considered the revenue arising from transactional activities as a key audit matter due to the reliance upon a highly complex IT environment, the high number of transactions, and the necessary manual inputs to issue the invoices.

We have assessed and tested the internal controls in relation to securing the transactions flows recorded in the Group’s revenues; our IT specialists have assisted us in performing the following procedures: We have tested the general IT controls of the main IT ● applications supporting revenue streams arising from transactional activities; We have also tested the operating effectiveness of the ● manual or automated controls securing the completeness and the validity of the accounting records. Moreover, we have performed substantive testing on manual journal entries in order to ensure the validity of the accounting entries booked in the financial statements. Finally, we have reviewed the accounting treatment of each revenue streams in order to ensure the consistency of the accounting treatment with the contractual arrangements signed with the clients. We have examined the determination of the fair value of the consideration, including the assumptions and methods used to determine the fair value of the contingent consideration as well as the price adjustments. The consolidated opening balance sheet of SPS as of December 1, 2018 had been subject to specific audit procedures covering the main subsidiaries, that were supplemented in 2019 with audit procedures regarding the subsequent adjustments of the opening balance sheet based on the information that became available during the allocation period, in relation to facts and circumstances existing on the date of SPS acquisition. Worldline appointed an independent appraiser to assist in the identification and valuation of intangible assets acquired and their allocation to the entities of the acquired group. Our approach consisted in reviewing the final expert’s report and assessing the consistency of the assumptions and estimates used with the business plans obtained: We have interviewed the independent expert on the scope ● of his work, the valuation methodologies used and the main assumptions made; We have assessed the relevance of the valuation methods ● used, with the support of our own valuation specialists; We have interviewed the Management to corroborate the ● assumptions used in the business plans supporting the valuation of the intangible assets. Finally, based on these elements, we have reviewed the calculation of the final goodwill and its allocation to SPS group entities and assessed the appropriateness of the disclosures related to the acquisition provided in the notes to the consolidated financial statements.

Final allocation of the purchase price of Six Payment Services (“SPS”) Note 1 Main changes in the scope of consolidation of consolidated financial statements Key Audit Matter Our audit approach

The Group has completed the acquisition of the payment services division of the SIX Group (“SPS”) on November 30, 2018, for an initial amount of € 2,826.1 million, which was reduced by € 47 million in 2019 as a result of price adjustments. As described in Note 1 of the consolidated financial statements, the consideration transferred was subject to a preliminary allocation as of December 31, 2018, to the identifiable assets acquired and liabilities assumed, based on an estimate of their fair value and the information available at that date. The final allocation period of the purchase price ended at the end of November 2019. At that date, the Group retrospectively recorded adjustments in relation to the valuation of intangible assets and current and non-current liabilities in order to take into account the information related to the facts and circumstances that had existed at the date of acquisition. These adjustments have reduced the net equity by €95 million net of tax. This final allocation has led to the recognition of intangible assets for an amount of €576,1 million net of deferred tax and the final goodwill of €2,126.5 million. We have considered the final allocation of the transaction price as a key audit matter, given the use of Management’s estimates and judgment, in determination of the consideration transferred, the final allocation to the identifiable assets and liabilities, to the goodwill acquired and the disclosures provided in the notes to the consolidated financial statements.

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239 Universal Registration Document 2019