151 / 266
151
2014 Registration Document
Consolidated Financial Statements Year ended December 31, 2014
5
Notes to the Consolidated statements
2.8
BANKING ACTIVITIES
To support its core retailing business, the Group offers banking and
insurance services to customers through Carrefour Banque and other
subsidiaries.
Due to its specific financial structure, this secondary business is presented
separately in the Consolidated Financial Statements:
■
consumer credit granted by the financial services companies (payment
card receivables, personal loans, etc.) is presented in the statement
of financial position under “Consumer credit granted by the financial
services companies – long-term” and “Consumer credit granted by
the financial services companies – short-term”, as appropriate;
■
financing for these loans is presented under “Consumer credit
financing – long-term” and “Consumer credit financing – short-term”,
as appropriate;
■
the other assets and liabilities of the banking activities (property and
equipment, intangible assets, cash and cash equivalents, accrued
taxes and payroll costs, etc.) are presented on the corresponding
lines of the statement of financial position;
■
net revenues from banking activities are reported in the income
statement under “Other revenue”;
■
cash flows generated by banking activities are reported in the statement
of cash flows under “Change in consumer credit granted by the financial
services companies”.
2.9
INVESTMENT PROPERTY
IAS 40 defines investment property as property (land or a building or
both) held to earn rentals or for capital appreciation or both. Based on this
definition, investment property held by the Group consists of shopping
malls (retail and service units located behind the stores’ check-out area)
that are exclusively or jointly owned and represent a surface area of at
least 2,500 square meters.
Investment property is recognized at cost and is depreciated over the
same period as owner-occupied property.
The properties’ fair value is measured twice a year:
■
by applying a multiple that is a function of (i) each shopping mall’s
profitability and (ii) a country-specific capitalization rate, to the gross
annualized rental revenue generated by each property; or
■
by obtaining independent valuations prepared using two methods: the
discounted cash flows method and the yield method. Valuers generally
also compare the results of applying these methods to market values
per square meter and to recent transaction values.
In view of the limited external data available, particularly concerning
capitalization rates, the complexity of the property valuation process and
the fact that valuations are based on passing rents for the Group’s own
properties, the fair value of investment property is considered as being
determined on the basis of Level 3 inputs.
The fair value of investment property is presented in Note 19.
2.10
INVENTORIES
In accordance with IAS 2 –
Inventories
, goods inventories are measured
at the lower of cost and net realizable value.
Cost corresponds to the latest purchase price plus all related expenses.
This method is appropriate given the rapid inventory turnover, and the
resulting values are close to those obtained by the FIFO method. The
cost of inventories includes all components of the purchase cost of goods
sold (with the exception of exchange gains and losses) and takes into
account the purchasing terms negotiated with suppliers.
Net realizable value corresponds to the estimated selling price in the
ordinary course of business, less the estimated costs necessary to
make the sale.