NOTE 1 Accounting principles & policies applied The new ANC regulations on the modernisation of financial statements have been in force since 1 January 2025: Regulations/recommendations, and their date of first application (transactions or financial years commencing on or after 1 January 2025): - ANC Regulation No. 2022-06 amending ANC Regulation No. 2014-03 of 5 June 2014 on the general chart of accounts (modernisation of financial statements): 01/01/2025 - ANC Regulation No. 2023-03 of 7 July 2023 amending various ANC regulations in conjunction with ANC Regulation No. 2022-06 of 22 November 2022 on the modernisation of financial statements: 01/01/2025 1.1. INTRODUCTION CFM Indosuez’s financial statements are prepared in compliance with the regulations that apply to credit institutions in the Principality of Monaco, within the framework of the agreements between France and Monaco. 1.2. ACCOUNTING PRINCIPLES AND ACCOUNTING METHODS A) Translation of assets and liabilities denominated in foreign currencies Assets and liabilities denominated in foreign currencies are translated at the market exchange rates at the balance sheet date. The income and expenses resulting from these translations, together with the translation differences generated on transactions during the financial year, are recognised in the income statement. B) Foreign exchange transactions Spot and forward foreign exchange contracts Spot foreign exchange contracts are valued at the spot market rate for the currency in question at each balance sheet date. Forward currency transactions are back-to-back transactions, and the rate used is the spot rate for the currency in question. Foreign exchange options Currency options are back-to-back transactions entered into on the over-the-counter market. C) Forward interest rate instruments Interest-rate swaps These are primarily back-to-back contracts that form part of the asset and liability management process. The expenses and income relating to these transactions are entered on the income statement on a pro rata basis. Interest-rate options Interest-rate options are back-to-back transactions entered into on the over-the-counter market. D) Securities Trading securities Trading securities are securities purchased on an organised market that is sufficiently liquid, with a view to reselling them within a maximum timeframe of six months from the outset. Trading securities are valued at their market value. The capital gains or losses generated are recorded under income or expense for the financial year. Investment securities Investment securities are financial investments purchased in order to provide a financial return. A provision is recognised when the market value is lower than the book value. Investment shares The recording of impairment provisions on equity investments is assessed on an individual basis, taking account of their value-in-use and of the economic and financial appraisal of each company concerned. Notes to the published financial statements CFM Indosuez Wealth Management 154
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