Carrefour - 2017 Registration Document

COMPANY FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2017 Notes to the Company Financial Statements 2017 REGISTRATION DOCUMENT | CARREFOUR 6. 302 Accounting principles Note 1 The financial statements of the Company have been prepared and are presented in accordance with the principles and policies defined in Autorité des Normes Comptables (ANC) Regulation 2014-03, approved by government order of September 8, 2014. The financial statements have been prepared on a going concern basis using the accruals method, in accordance with the principle of prudence. Accounting policies have been applied consistently from one period to the next. Assets and liabilities are measured according to the historical cost convention. There were no changes in measurement or presentation methods in 2017 compared with the previous year. ANC Regulation 2015-05 on forward financial instruments and hedging transactions, applicable as of January 1, 2017, had no impact on the financial statements for the year ended December 31, 2017 and did not give rise to the restatement of prior periods. Tangible and intangible fixed assets 1.1 Intangible assets mainly comprise software, stated at acquisition cost. Tangible fixed assets are stated at cost, corresponding to the purchase price and ancillary expenses. Intangible fixed assets are amortised and tangible fixed assets are depreciated over their estimated useful lives, as follows: Software: 3 to 8 years; ● Computer equipment: 3 years; ● Building fixtures and fittings: 8 years; ● Other: 3 to 10 years. ● If the net carrying amount of a tangible or intangible fixed asset is not expected to be recovered through the future economic benefits generated by the asset, an impairment loss is recognised for the difference between its carrying amount and the higher of its value in use and fair value. Financial investments 1.2 Financial investments consist of shares in subsidiaries and affiliates, including any allocated merger deficits, loans and advances to subsidiaries and affiliates and other financial assets. Shares in subsidiaries and affiliates are stated at cost. At January 1, 2016, on the first time application of ANC Regulation 2015-06, merger deficits resulting mainly from the merger of Carrefour-Promodès in 2000 were allocated to the investments in Carrefour France, Norfin Holder, Caparbel, Carrefour Nederland BV and Hyparlo based on the respective unrealised gains as at that date. Shares in subsidiaries and affiliates are tested for impairment at each year-end to confirm that their net carrying amount (including the net carrying amount of any allocated merger deficits) does not exceed their value in use. Value in use is estimated based on a range of criteria including the Company’s interest in the investee’s net assets, projected future cash flows from the investment and a fair value measurement of the net assets based on reasonable business projections if existing (multiples of net sales and/or EBITDA for recent transactions, offers received from buyers, stock market multiples for comparable companies) or based on analyses performed by internal or external experts, adjusted where applicable for net debt. An impaiment is recorded when the value in use is becomes lower than the net book value (including, when applicable the net book value of affected merger deficit). Impairment losses are recorded in net financial income or expense, along with impairments written off on disposal of the interests concerned. Gains and losses on disposal of shares in subsidiaries and affiliates are recorded in non-recurring income or expenses. Accounts receivable 1.3 Accounts receivable mainly correspond to intra-group receivables related to the provision of services, in which case the receivables are recognised when the service is provided. Accounts receivable are stated at their nominal amount and an impairment loss is booked when their recoverable amount falls below their carrying amount.