APC 2013 Annual Report Download - page 193

CONSOLIDATED FINANCIALSTATEMENTS ATDECEMBER 31, 2013
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
These assumptions mainly concern: The excess of the cost of acquisition over the Group’s share in
the fair value of assets and liabilities at the date of acquisition is
the measurement of the recoverable amount of goodwill,
l
recognized in goodwill. Where the cost of acquisition is lower
property, plant and equipment and intangible assets than the fair value of the identified assets and liabilities acquired,
(note1.11) and the measurement of the goodwill impairment the negative goodwill is immediately recognized in the statement
(note8), of income.
the measurement of the recoverable amount of non-current
l
Goodwill is not amortized, but tested for impairment at least
financial asset (note1.12 and note15), annually and whenever there is an indication that it may be
the realizable value of inventories and work in process
l
impaired (see note1.11 below). Any impairment losses are
(note1.13), recognized under “Amortization and impairment of purchase
the recoverable amount of accounts receivable (note1.14),
laccounting intangibles”.
the valuation of share-based payments (note1.20),
l
Translation of the financial statements 1.7 –
the calculation of provisions for contingencies, in particular for
l
warranties (note1.21),
the measurement of pension and other post-employment
lofforeign subsidiaries
benefit obligations (note22). The consolidated financial statements are prepared in euros.
Consolidation principles1.5 – The financial statements of subsidiaries that use another
functional currency are translated into euros as follows:
Subsidiaries, over which the Group exercises exclusive control, assets and liabilities are translated at the official closing rates,
l
either directly or indirectly, are fully consolidated. Exclusive income statement and cash flow items are translated at
l
control is control by all means, including ownership of a majority weighted-average annual exchange rates.
voting interest, significant minority ownership, and contracts or Gains or losses on translation are recorded in consolidated
agreements with other shareholders. equity under “Cumulative translation adjustments”. In
Group investments in entities controlled jointly with a limited accordance with IFRS1 – First Time Adoption of IFRS–
number of partners, such as joint ventures and alliances, are cumulative translation adjustments were reset to zero at
proportionally consolidated in accordance with the January1, 2004 by adjusting opening retained earnings, without
recommended treatment under IAS31 – Interests in Joint any impact on total equity.
Ventures.
Foreign currency transactions1.8 –
Companies over which the Group has significant influence
(“associates”) are accounted for by the equity consolidation
method. Significant influence is presumed to exist when more Foreign currency transactions are recorded using the official
than 20% of voting rights are held by the Group. exchange rate in effect at the date the transaction is recorded or
the hedging rate. At the balance sheet date, foreign currency
Companies acquired or sold during the year are included in or payables and receivables are translated into the functional
removed from the consolidated financial statements as of the currency at the closing rates or the hedging rate. Gains or losses
date when effective control is acquired or relinquished. on translation of foreign currency transactions are recorded
Intra-group balances and transactions are eliminated. 5
under “Net financial income/(loss)”. Foreign currency hedging is
The list of consolidated subsidiaries and associates can be found described below, in note1.23.
in note32.
Intangible assets1.9 –
The reporting date for all companies included in the scope of
consolidation is December31, with the exception of certain
associates accounted for by the equity method. For the latter
Intangible assets acquired separately or as part
however, financial statements up to September30 of the
financial year have been used (maximum difference of three ofabusiness combination
months in line with the standards). Intangible assets acquired separately are initially recognized in
Business combinations1.6 –
the balance sheet at historical cost. They are subsequently
measured using the cost model, in accordance with IAS38 –
Intangible Assets.
Business combinations are accounted for using the acquisition Intangible assets (mainly trademarks and customer lists) acquired
method, in accordance with IFRS3 – Business Combinations. In as part of business combinations are recognized in the balance
accordance with the option provided by IFRS1 – First-Time sheet at fair value at the combination date, appraised externally
Adoption of IFRS– business combinations recorded before for the most significant assets and internally for the rest, and that
January1, 2004 have not been restated. Material acquisition represents its historical cost in consolidation. The valuations are
costs are presented under “Other operating income and performed using generally accepted methods, based on future
expenses” in the statement of income. inflows. The assets are regularly tested for impairment.
All acquired assets, liabilities and contingent liabilities of the
buyer are recognized at their fair value at the acquisition date,
the fair value can be adjusted during a measurement period that
can last for up to 12months from the date of acquisition.
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