Worldline - 2020 Universal Registration Document

E

FINANCIALS Consolidated financial statements

An intangible asset related to the customer relationships and backlog brought during a business combination is recognized as customer relationships. The value of this asset is based on assumptions of renewal conditions of contract and on the discounted flows of these contracts. This asset is amortized on an estimation of its average life. The value of the developed technology acquired is derived from an income approach based on the relief from royalty method. This method relies on (i) assumptions on the obsolescence curve of the technology and (ii) the theoretical royalty rate applicable to similar technologies, to determine the discounted cash flows expected to be generated by this technology over their expected remaining useful life. The developed technology is amortized on an estimation of its average life. The cost approach may also be implemented as a secondary approach to derive an indicative value for consistency purposes. This method relies on assumptions of the costs that should be engaged to reproduce a similar new item having the nearest equivalent utility as the asset being valued. On the contrary, if technology is believed to be the most important driver for the business, an Excess Earning method could also be implemented. Intangible assets are amortized on a straight-line basis over their expected useful life, for internally developed IT solutions in operating margin. Customer relationships, patents, technologies and trademarks acquired as part of a business combination are amortized on a straight-line basis over their expected useful life, generally not exceeding 19 years; any related depreciation is recorded in other operating expenses. Impairment of assets other than goodwill At the end of each reporting period of the financial information, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. This is also applied to R&D costs capitalized. If it is not possible to assess the recoverable amount of an individual asset, the Group estimates the recoverable amount of the Cash Generating Unit to which the asset belongs. If a reasonable and consistent method of allocation can be identified, corporate assets are also allocated to Cash Generating Units individually; otherwise they are allocated to the smallest group of Cash Generating Units for which a reasonable and consistent allocation method can be determined. The recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted. If the estimated recoverable amount (or Cash Generating Unit) is less than its carrying amount, the carrying amount of the asset (or Cash Generating Unit) is reduced to its recoverable amount.

Customer Relationships/Patents

Software & Licenses

Other assets

Total

(In € million)

Gross value At January 1, 2020

798.6

626.3

39.7

1,464.7

Additions

28.4 59.7

2.9

31.3 59.7

R&D capitalized

Impact of business combination

772.0 -18.6

1,519.5

36.2 -0.4 -0.6 -2.4 75.4

2,327.6

Disposals

-19.0

Exchange differences

-2.3

-1.8

-4.7 -0.6

Other

1.9

At December 31, 2020 Accumulated depreciation At January 1, 2020 Depreciation charge for the year Impact of business combination

1,639.7

2,143.9

3,859.1

-239.3

-148.8

-29.4

-417.5 -180.2

-80.4 -48.4

-99.8

-0.1 -3.5

-51.8

Disposals/reversals Exchange differences

18.5

0.0 1.0 0.3

18.5

1.7

1.0

3.6 0.1

Other

-0.1

At December 31, 2020 Net value At January 1, 2020 At December 31, 2020

-348.1

-247.6

-31.7

-627.3

559.3

477.5

10.3 43.7

1,047.1 3,231.7

1,291.6

1,896.3

282

Universal Registration Document 2020